Mal, Evie, Jay, and Carlos visit the Isle of the Lost to choose four new villain kids (VKs) to take to Auradon. They pick Dizzy, granddaughter of Lady Tremaine; Celia, daughter of Dr. Facilier; and Squeaky and Squirmy, the twin sons of Mr. Smee.

The day the kids are to be picked up, Mal’s boyfriend Ben, the king of Auradon, proposes. Mal accepts. Ben’s ex-girlfriend Audrey seethes with jealousy, and her grandmother Queen Leah admonishes her for failing to secure the family legacy by marrying Ben. As the older VKs return to Auradon after picking up the kids, Hades attempts to break through the Isle’s barrier, but Mal stops him, getting weakened in the process.

Unable to let go of her resentment of Mal, Audrey steals the Queen’s crown and Maleficent’s scepter from the museum, gaining magical powers and becoming a villain. Following the theft and Hades’ escape attempt, Mal suggests the best way to protect Auradon is to close the Isle’s barrier permanently.

Audrey curses Mal with Maleficent’s scepter and turns her into an old woman, so she and the other VKs go to the Isle to get Hades’ ember, the only artifact powerful enough to break the scepter’s curse. Upon entering the Isle, Mal is freed of the curse (because no dark magic was allowed there) and Celia gets her into Hades’ lair, but Hades thwarts their effort to steal the ember.

Hades is revealed to be Mal’s absentee father and reluctantly gives her the ember, warning her to avoid getting it wet as it will not exhibit its powers for her, and that since she is only “half Hades”, it may not do everything for her that it does for him. While leaving the Isle, Mal and the others are intercepted by Uma, Gil, and Harry, who agree to help after Mal falsely agrees to release all the children from the Isle.

Meanwhile, in Auradon, Audrey crashes Jane’s birthday party with a sleeping curse; Chad aligns himself with her, while Jane escapes into the enchanted lake. As the entire kingdom falls under Audrey’s spell, she offers to reverse it if Ben will marry her. His refusal prompts Audrey to turn him into a beast and she begins turning people to stone.

Mal and Uma, vying for the leadership of the VKs, return to Auradon with their friends. Despite their conflict, they eventually work together to find and defeat Audrey. After finding Ben in beast form, Carlos calms him after removing a splinter from his hand, while Jane restores him to human form with the enchanted lake water.

At Evie’s house, Mal and Uma make amends while Evie wakes Doug with true love’s kiss. Audrey traps them in the house, but they are able to reverse Audrey’s spell by combining their magic, and they and their other friends reunite.

At the Fairy Cottage, they find only a shell-shocked Chad. When Mal admits her plan to seal off the Isle permanently, the group breaks apart and Celia, learning she can never see her father again, drops the ember in water and Uma walks away. After Evie confronts Mal for lying to her and their friends, Ben, Carlos, Evie and Jay are all suddenly turned to stone.

Audrey takes Celia hostage and attacks Mal, who turns into her dragon form. Realizing she is Mal’s only hope, Uma comes back and combines their magic to reignite the ember. Mal defeats Audrey, who falls into a deep coma, and the curses are lifted. Mal and her friends reconcile, and she convinces Hades to use the ember to revive Audrey. Hades does so, but decries the double standard by which Audrey is immediately forgiven for her crimes as she is not considered a villain. Audrey awakens, and she, Mal and Ben make amends.

Changing her mind, Mal tells Ben that she cannot become queen of Auradon unless she can help the Isle as well. With Ben and Fairy Godmother’s approval, Mal replaces the Isle’s barrier with a bridge, and the people of the newly merged society celebrate.

In the end, Evie is with Doug, Carlos is with Jane, Mal and Ben are engaged, Jay and Gil plan to travel the world together, and Audrey seems to become romantically attached to Harry after Uma rejects him.

In a mid-credits scene, Mal, Evie, Jay, and Carlos race across the bridge to the Isle to reunite with their parents.