It's 1999, a bunch of freakish overgrown aliens have invaded Earth. It's up to three freakish overgrown Earth monsters to stop them. By romping through major metropolitan areas, destroying buildings and killing as many civilians as possible, while wrestling the aliens.
King of the Monsters 2 is a 2D wrestling/fighting game with three monsters for players to select. Once the monster selection is completed players must guide their monsters through a series of stages consisting of parts of various famous world cities. Each level consists of a short side-scrolling portion in which the player's monster must deal with things like attacking tanks and ships. At the end of the side scrolling portion the alien boss monster appears for a fight.
The buildings and vehicles in the stages sometimes give up certain items when destroyed. The best type to collect is the power-up icon; up to two of these can be collected to boost the monster's strength. There are also icons that make monsters move faster or slower, drain collected power-up levels, explode for damage, or just provide points. Accumulated power-up levels carry over into subsequent stages.
Players must defeat the boss monsters within the given time limit to beat the stage. Unlike the first King of the Monsters, it's no longer necessary to pin the opposing boss. When the boss' power bar is drained it loses. If the player monster is unable to beat the boss before the timer runs out, the monster dies costing the player one life and the timer is refilled.
In addition to the one player campaign mode, two players can either play head to head or team up against the CPU monsters.