Set four years after the first movie, Lin Xiao, Lily, Nan Xiang, and Ruby, confront opportunities and challenges as their school days come to an end.

扈都——盛世唐朝西部的邊境之城。為保護百姓不受妖魔的侵害，鍾馗（陳坤飾）在張道仙的指引下成為斬妖士，深入魔界盜取集合妖魔能量的寶盒，以期利用千年不遇的機會，徹底掃蕩魔界，給人間帶來永久和平。 魔王則派各路妖怪前來想奪回寶盒，維護魔界的的勢力。一身正氣的鍾馗在御敵過程中卻發現原以為界限分明的人魔兩界，遠比想像的要復雜。而偶遇昔日戀人雪妖（李冰冰飾），誤入這段注定不該發生的戀情，使得鍾馗開始懷疑存在的目的。在與魔界一次次的衝突後，鍾馗慢慢察覺自己已經陷入了一個巨大的陰謀之中……

延續首集劇情，二次大戰後葉問大師離開佛山，赴香港開館收徒，在那遭逢強大的對手〈洪門〉。兩大武學門派不打不相識，從一開始的相互較勁，到後來聯手對抗英國殖民政府，一段英雄惜英雄的故事，葉問不僅武藝拔萃、濟弱扶傾，並盡現宗師風範與恢弘氣度。他也在此時期將畢生最重要的徒弟李小龍，納入門下！ 首集勇奪全台賣座冠軍，再造華語武林熱潮新一代宗師。全片勇奪香港電影金像獎最佳影片，詠春拳法，一時無兩；全片原班人馬再度合作，拿遍華語電影界動作指導獎項的洪金寶，也躍入幕前大展拳腳。詠春拳與洪門鐵拳對戰為片中一大高潮，再掀武打片風潮。

"Fist of Dragon" tells the story of Li, who comes to South East Asia by the request of his father to help out his uncle who has been facing financial difficulties. Li, upon arriving in the town, feels out of place due to the differences in cultures of the people here. When he discovers that his uncle has been facing many hardships posed by the local mobsters, Li decided to stay and to help his uncle and get rid of them. However, Li encounter numerous resistances from the locals as Li's action brings the wrath of the triad and drags the whole town into turmoil. Moreover, his uncle's daughter, Lily is on the triad side, and their relationship is badly affected when the confrontation between the two groups reach its peak.