A young Asian American martial artist is forced to participate in a brutal formal street-fight competition.

Mr. Miyagi and Daniel take a trip to Okinawa to visit Mr. Miyagi’s dying father. After arriving Mr. Miyagi finds he still has feelings for an old love. This stirs up trouble with an old rival who he originally left Okinawa to avoid. In the mean time, Daniel encounters a new love and also makes some enemies.

Kreese, his life in tatters after his karate school was defeated by Daniel and Mr. Miyagi, visits Terry, a friend from Vietnam. Terry is a ruthless business man and a martial arts expert, and he vows to help Kreese take revenge on Daniel and Mr. Miyagi.

The life of the greatest karate master of a generation.