"If music be the food of love", it's also at the heart of Paul Hart's jaunty jazz-age production. Onstage at the Elephant Jazz Club his tight ensemble of actor-musicians take it away with their big brassy sound - no wonder Jamie Satterthwaite's sexy Orsino commands them to 'play on'! Their heart-catching rendition of "Mad World" takes you into the play's disconcerting world of disguises, cross-dressing and wicked practical jokes.

The cast take partners from the audience onto the dance floor of Katie Lias' golden speakeasy set, flanked by lamp-lit tables, with mysterious alcoves behind, where musicians and lovers linger. On the balcony above, Offue Okegbe's resourceful Feste, more ringmaster than clown, orchestrates the madness. Almost anticipating Prospero, he oversees the wreck that separates Rebecca Lee's determined Viola and Stuart Wilde's virile Sebastian, darkly imagined below him.

So the scene is set for the daisy chain of yearning lovers and mistaken identities. Gender-blind casting makes it all the more provocative. The National Theatre has its Malvolia, but Lauryn Redding's expansive Sir Toby, doesn't change her name – her sex is a given and her marriage to Maria needs no explanation. Nonetheless, the ‘notable pirate' who rescues Sebastian is Antonia, not Antonio. It gives a different spin to Emma McDonald's feisty and ardent Antonia, risking her life for his love, in the country where she is a wanted woman. In this febrile atmosphere, it's only natural for Aruhan Galieva's sprightly Olivia to become coquettish once she has Viola in her sights.

In this age of prohibition, Malvolio's mission is to stand guard over all that's forbidden in Olivia's house. Since forbidden fruit is sweeter, it's no wonder Toby and Feste join forces with Mike Slader's gangling Aguecheek to rope Victoria Blunt's brisk and bossy Maria into a boisterous, alcohol-fuelled jamming session. Blunt's double bass serves as the unlikely box hedge behind which these conspirators hide to watch her letter lure Malvolio to his destruction

Peter Dukes' steward is a terrific tragi-comic creation, morphing from snooty steward to posturing wannabe squire, to pouting transvestite, channelling The Rocky Horror Show's Frank-N-Furter in little more than those yellow stockings. You could argue it's too crude, but with the addition of artfully-crossed suspenders, it makes sense.

Ironically, Malvolio's descent into madness is actually an ascent, stranded and exposed on a platform centre-stage. In a thought-provoking coup de theatre, even as Feste goads him into madness from above, Sebastian also appears on the balcony, wondering if he is mad to imagine Olivia might love him – a mad world indeed.

By the time all is resolved with a final glorious jamming session, the audience is begging the brass to 'play on' long after the last curtain call.

Twelfth Night runs at The Watermill Theatre until 6 May, then in repertory with Romeo and Juliet to 22 July.