The sequel picks up where the first part left off. In "The Super Mario Bros. Movie," Mario and Luigi proved themselves as heroes and defeated the turtle villain Bowser. The two have since left their everyday life in Brooklyn behind. Instead, they've now found a new home in the fantastical realms of the Mushroom Kingdom. There, they help out wherever they can and have plenty of fun. Only Princess Peach occasionally struggles with her unknown origins.
Meanwhile, Bowser—now shrunken into a mini-villain—has turned into a wannabe artist and still dreams of Princess Peach. Much to Mario's displeasure, as he apparently feels drawn to the princess himself. Soon, however, the plumber faces a whole different problem: Bowser Jr. wants to help his father regain his former glory—and the little rascal seems willing to stop at nothing to make it happen.