At first, I thought it must be some kind of mistake. There, in the window of Annapolis's Rams Head Tavern, where I had come to see Sandra Bernhard perform in September, I spotted, along with all the other cheesy headshots of upcoming acts, an 8-by-10 glossy of someone who looked a lot like . . . Jeff Daniels. Yeah, that Jeff Daniels.

Fast forward one month.

I'm back at Rams Head, listening to none other than Mr. "Dumb and Dumber" and the critically acclaimed star of "The Squid and the Whale" (see review on Page 44) sing and play acoustic guitar on a number of mostly very funny -- and at times rather touching -- songs. Along with the hilariously self-deprecating opening number, "If William Shatner Can, I Can Too," which pokes fun at the sometimes dubious musical talents of such actors as David Hasselhoff, Kevin Bacon and Russell Crowe, the music is mostly off his new CD, "Jeff Daniels Live and Unplugged to Benefit the Purple Rose Theater." Proceeds from the sale of the collection of folk tunes are earmarked for the 15-year-old theater that the thespian-cum-closet-singer-songwriter founded in his hometown of Chelsea, Mich. Who knew?

"That was my disclaimer," Daniels jokes at the end of "Shatner." "Thanks for paying for something I'm not known for." A little while later, he launches into "Dirty Harry Blues," a five-minute musical synopsis of what it was like to play the bad guy and get shot by Clint Eastwood in the 2002 thriller "Blood Work." Daniels's wry, rambling, between-song patter touches upon the themes of aging (he's 50), being mistaken for Jeff Bridges, actor Robert Blake's acquittal on murder charges and a recent Redskins loss, which he's happy to rub in.

Backstage after the show, the actor is more serious, talking about his initial "terror" of performing his music in front of people, his reasons for opening a theater in a "two-stoplight" Michigan town and the creation of his "Squid" character Bernard, an "oblivious, pompous ass" based on writer-director Noah Baumbach's father, novelist Jonathan Baumbach.

Although Daniels says he has been writing music for 30 years, compiling notebooks stuffed with "275 songs, 200 of which are [expletive]," it was only five years ago that he got up enough nerve to play them in front of an audience. That happened in a bar, at the insistence of playwright Lanford Wilson, an old pal of Daniels's from the 1970s when both were working at the Circle Rep theater in New York. "Lanford told me, 'You can't not do this. You have to do this. You can't hide this. You're not trying to be Bob Dylan. This is what you do, and you do it really well.' "

Daniels, who calls his singing more difficult than acting because "you're naked out there," without the luxury of "hiding behind the veneer of a character," soon got over his case of nerves. A weekend of shows over Christmas a few years ago grew to 10 shows over two weeks last winter. All the profits benefit the Purple Rose, a theater that draws audiences from Ann Arbor, Detroit and sometimes Chicago. Thereby hangs another tale, of a man stuck in a small Midwest town with limited cultural offerings.

Moving with his high school sweetheart wife back to Chelsea, where he grew up, from New York, where he had won a 1982 Obie for his performance in the one-man show, "Johnny Got His Gun," was, Daniels says, a huge gamble.

"We had no idea the career would last," says the actor, who didn't want to raise his young children in either New York or Los Angeles but who was willing to give jetting to meetings and auditions on either coast -- and at his own expense -- a shot. "At least if the career keeps going," he says, "the kids will be in a place that's normal." By 1990, Daniels says, "I'm playing a lot of golf, the career's doing fine, but creatively I'm going to sleep." Enter the Purple Rose, an outlet for often newly commissioned plays and an incubator for local talent that Daniels says he "missed" from his own youth, and with which he hoped to replace the hungry, seat-of-the-pants energy he experienced in New York, of "the playwright struggling with the second act in the basement."

Although he has achieved the kind of success a lot of actors would give an arm for, Daniels describes another kind of persistent hunger inside him, one he was able to tap into for his portrayal in "Squid" of a talented but vaguely embittered man whose writing career is waning even as that of his estranged wife (Laura Linney) is on the rise. It's a performance -- sad, funny, sympathetic, pathetic and raw -- that some are calling worthy of Academy Award consideration.

"When you live in Michigan," Daniels says, "and I've had a great career, and I'm very happy with the career, wouldn't change a thing, I really wouldn't -- but I've stood next to guys who make $20 million a movie, and they've won awards. And eventually there's a part of you that feels underappreciated. It's a small part. I don't get up every day feeling underappreciated. But that's what actors do. You use yourself, and then you abuse yourself. And so I just took that underappreciation in me and just gasolined and lit a fire under it. Lit a match, and it became Bernard."

As for the temptation to get too caught up in the Oscar hype of the entertainment punditocracy, Daniels says it's impossible to ignore it completely, even in Michigan. "Oh, you're aware," he says of the awards buzz. "It's nice. It beats the alternative. But at the end of the day, none of these people vote. If I'm nominated, I'll rent a tux and be there, you bet. The trick is not to expect it. Because we find out just like everybody else does when 'The Today Show' comes up and they go down the names: one, two, three, four."

What helps get Daniels through "all that" is the knowledge that he's a member of an elite fraternity, that he's in what he calls "the room where all the good actors are, where nobody's better than anybody else, where everybody is just [expletive] good." Although he says he has been in that room before -- and subsequently kicked out of it, thanks to material like "Dumb and Dumber" (1994), which he'd nevertheless love to make a sequel to, by the way -- he feels pretty comfortably ensconced in it with this latest film.

There's a line in "If William Shatner Can, I Can Too" in which the actor sings that "movie stardom's just a job, when you can sing like Billy Bob." He admits that sometimes that has been true for him, too. That some roles he has taken are just that: jobs, providing little in the way of satisfaction besides a paycheck. And when it isn't true? "That's when you do 'The Squid and the Whale.' "

The "Squid and the Whale" actor looked comfortable among the little fish onstage in Annapolis.