But Merkel's true forte was comedy, and she was almost promptly typed as the knowing but sunny-natured second lead in films like "Private Lives" (1930), "42nd Street" (1933), "On Borrowed Time" (1939) and "The Bank Dick" (1940). She held her own in a memorable brawl with Marlene Dietrich in "Destry Rides Again" (1939) and went on to grace such diverse features as "The Kentuckian" (1955) and "The Parent Trap" (1961). Merkel also supported Jean Harlow in four films, "Red Headed Woman" (1932), "Bombshell" (1933), "Riffraff" (1935) and "Saratoga" (1937). In 1961, she was nominated for a Best Supporting Actress Oscar for her recreating her stage portrayal of the unstable mother of Alma Winemiller (Geraldine Page) in "Summer and Smoke".
Late in life, Merkel returned to the stage with great success, winning a Tony Award for "The Ponder Heart" (1956), also appearing in "Three's a Family" (1944), "The Remarkable Mr. Pennypacker" (1953) and alongside Jackie Gleason and Walter Pidgeon in the musical "Take Me Along" (1959).