I don't think it should be one event that happens sometimes, I think it should be a memetic that spreads, and all effected by the memetic somehow know when a song is about to start and will break out into dance together with strangely choreographed musical numbers, centering around their everyday lives. People around them may hear an invisible orchestra swell to their singing, and people who were bad at singing before can suddenly sing amazingly. During song and dance, they get into a euphoric state, that encourages the singing. However, those affected by the memetic can be aware that they are affected, although this will not stop song and dance. Anybody who is witness to / hears these songs will become affected by the memetic, so a parade of these people romping through a city could infect an entire neighborhood, if not more.
That's what I get out of it, anyways. Just, literally a living musical. I would make it as ridiculous as humanly possible, while still maintaining real world consequences. Also, it should probably affect animals and skips to a lesser degree as well, so that they may join in on the song and dance. Like, maybe it is just a reality bending spreading event thingy.