Three years have passed since Travis Touchdown became the top assassin in the United Assassins Association and walked away. Now, he returns to Santa Destroy and fights Skelter Helter, who seeks revenge on Travis for killing his older brother Helter Skelter prior to the first game. After winning the battle, he meets Sylvia Christel again, who informs him he is now ranked 51st. The dying Skelter interrupts them and warns Travis that he and his co-conspirators will still have their revenge.
The same night, a group of criminals kill Travis's best friend, Bishop, and throw his head through Travis's window in a paper bag. Travis, furious and seeking revenge, asks Sylvia to set up the next fight. Sylvia tells him that the one who ordered his death was Jasper Batt, Jr., the CEO of Pizza Bat and first-ranked assassin. In the first game, Travis stopped three different attempts by Pizza Bat (then localized as "Pizza Butt") to expand into in Santa Destroy by assassinating the CEO. In the three years since, with Travis out of the picture, Pizza Bat successfully opened a headquarters in Santa Destroy and bought out practically every business in town. Travis resolves to climb to the ranks to get a chance for revenge on Jasper.
Travis fights and defeats Nathan Copeland. He then meets Charlie MacDonald and his cheerleaders, who transform into a giant mech called the Santa Death Parade. Travis defeats them in his own mech, the Glastonbury, built by Dr. Naomi and based on a mech from his favorite anime. He feels remorse for the cheerleaders, realizing that they were harmless, but backpedals after Sylvia offers to nullify his victory. Before heading off to the next fight, he is challenged by someone ranked below him; college student Kimmy Howell. He defeats her, but spares her life, commenting that he "can't kill a co-ed". He also begins to fight the supernatural, facing Matt Helms and Cloe Walsh.
Sylvia organizes a battle royale with Travis and eleven other assassins. Dr. Letz Shake immediately kills all of the other assassins except Travis. He is glad for the opportunity to get revenge on Travis as well, having previously defeated Henry and frozen him in carbonite. Travis kills him and defrosts Henry. He also meets Shinobu, the assassin whom he spared in the first game, who now idolizes him and calls him "Master". At Sylvia's request, she fought and defeated Million Gunman and New Destroyman for Travis. Shinobu advances on Travis, but he turns her away because he feels "like the pervy teacher in a porno". Rejected, she steps out.
Travis fights a grueling battle against Ryuji. Travis crows triumphantly after Ryuji concedes, but Sylvia kills him in cold blood, criticizing Travis for showing mercy. Henry, suffering from hibernation sickness, fights Mimmy in a nightmare before awakening. He reconciles with Travis and kills the next three assassins for him: Scott Gardner, Greg Cantrell and Massimo Bellini. Travis fights Margaret Moonlight and Captain Vladimir, and convinces Sylvia not to destroy the latter's body. After defeating Alice Twilight, the penultimate assassin, he decides he's fed up with the ranked battles and the UAA. He berates Sylvia, insisting that assassins are human and that they shouldn't have to die for entertainment like it's some kind of video game. He promises to tear down the UAA after defeating Jasper.
Travis fights his way through the Pizza Bat headquarters to meet Jasper in his office. Jasper reveals that he was seeking revenge for his father and two brothers, the Pizza Bat CEOs Travis killed in a mission in the first game. Henry enters and helps Travis defeat him. At the end of the fight, Travis leaps out the window to destroy Jasper's float and kill him. Sylvia, riding Travis's motorcycle, catches him and drops him off at his motel.
Years later, Travis finds Sylvia working at a strip club and pays for private shows from her nearly every day. He never speaks or reveals his identity, instead opting to listen to her recap the events of the game. On the last day, she breaks down and cries, asking to see his face and hear his voice. Travis finally reveals himself, and says "Let's go. Santa Destroy needs us".