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With an entirely new set of actors, this movie continues the story from Swordsman (1990). Blademaster and his martial arts school decide to retire to a distant mountain. Before leaving, he visits his friends, a tribe of snake-wielding women warriors. He finds that they have been attacked, and their leader, Princess Yin-Yin, toward whom he has some romantic feelings, has been abducted. The attacker is her evil uncle Fong, who years before overthrew Yin-Yin's father and took over their sect. Fong also has possession of a sacred scroll which tells how to achieve ultimate martial arts power. Blademaster decides to help Yin-Yin and her imprisoned father, and his romantic complications deepen when his childhood chum and Yin-Yin are joined by a new rival. Blademaster thinks she is an innocent village girl he has saved, but in fact she is Fong! The process of gaining ultimate martial arts power requires self- castration and transmogrification into female form.