Steve Martin with The Steep Canyon Rangers, Royal Festival Hall, London

Rich pickings for comedy and bluegrass fans alike

"It's always been a dream of mine to play banjo at the Royal Festival Hall," says Steve Martin, banjo in hand, from the stage of the Royal Festival Hall. The briefest of pauses, and then: "And tonight, I feel one step closer to realising that dream." Written out like that, it doesn't seem quite as funny as it did earlier this evening – but then, comedy is all about timing and delivery. And jokes. And some other stuff too humorous to mention, probably.

Right from his early stand-up days, the banjo has been an essential component of Steve Martin's character. When he was performing, solo, to tens of thousands of baying punters in stadiums back in the early 1980s, the musical frying-pan was as much a part of his routine as the balloon animals, the absurdist monologues and, of course, the Happy Feet. Playing banjo, he used to claim, could rouse one from the deepest despair, because "You just can't play a sad song on the banjo."

Since then, save for an irresistible opportunity to play "Foggy Mountain Breakdown" with bluegrass legend Earl Scruggs, he's made infrequent, overly modest use of the instrument: only one half of one of his albums, The Steve Martin Brothers, was dedicated to his musical passion – until earlier this year, when he released The Crow, an album of original banjo pieces performed with such country music luminaries as Scruggs, Vince Gill, Dolly Parton, John McEuen, and tonight's support act, Mary Black. With typical Martin mock-overstatement, it bore the claim: "This is the most expensive banjo album in the history of the universe - and that includes possible alternative universes, too." It was nominated for six prizes at the annual Bluegrass Music Association awards, but, he notes dryly, won only the award for best liner-note. "But when I went up to collect my award, Kanye West jumped up on stage, protesting that Doc Watson's sleevenote was better!"

Tonight's set is built around The Crow, with the comedian backed by The Steep Canyon Rangers, a young North Carolina bluegrass ensemble with a nice line in acappella jubilee harmonies, as they demonstrate during a brief mid-set showcase while Steve leaves to drink beer. When he returns, he insists on them joining him in an atheist sing-song lamenting the lack of songs "for godless existentialists". The violinist is particularly adept, and effects brilliant impressions of canine barks and whines on a fiddle and banjo duet dedicated to Martin's dog Wally.

And for all his self-deprecation about his own playing - "Rolling Stone called this a 'worthwhile illegal download'," as he introduces a track called "Freddie's Lilt" – Martin proves no slouch himself, picking his way nimbly through a solo demonstration of clawhammer banjo technique, and swapping lines confidently with the other players throughout. And despite his former assertion as to the impermeable humourousness of the banjo's sound, he knows all too well that, undriven by speedy bluegrass imperatives, it can be as sad and lonely an instrument as any. The closest he gets to this aspect tonight is perhaps the poignant descending melody line of "Tin Roof", and the wistful "Words Unspoken" a supposed singalong lacking lyrics.

Elsewhere, he introduces "Saga Of The Old West" as having "elements of sadness and melancholy – like the expression on my agent's face when I told him I wanted to do a banjo tour". For the rest of us, though, the experience is entirely uplifting and joyous, not least for offering a rare opportunity to hear one of the greatest comedians of the last three decades sprinkle around a few of the rib-ticklers he long since ceased performing as a stand-up.