The evil Techno-Warriors have enlisted the Black Ninja, master of ninja techniques, to help them take over Neo City. This evil syndicate has captured the four Elemental Crystals and their guardian ninjas. Joe Musashi, the Red Shinobi, must rescue his four fellow ninjas and retrieve their corresponding Elemental Crystals, before the final showdown against the evil Black Ninja in his castle.
The game is an action platformer similar to its predecessor. The player begins the game as the Red Ninja, whose mission is to retrieve five Elemental Crystals that were stolen by the enemy and spread across different locations. Similar to the original game, the first four rounds can be played in any order, and the player gains control of another ninja after completing each. Each ninja character has a unique weapon, ninjutsu, and ability. Some of the ninjas have different abilities from the previous game. Depending on the stage, the player must use a specific ninja's ability in order to reach the location of the crystal. As a result, some of the stages must be played more than once if the player does not have the necessary character yet. When the first four crystals are all gathered, the player gains access to the enemy's main base, where the fifth crystal is being held by the Black Ninja.
The ninja can be moved around with or and can crouch with . He can move while crouching with and . He can enter doors and elevators with . He can jump with and jump off a platform with +. The button strikes with the ninja's primary weapon. The START button invokes up a menu that allows the player to change the currently played ninja or use the current ninja's ninjutsu ability by selecting 忍術. The player can use ninjutsu abilities a finite amount of times; the player starts with no uses available but can gain opportunities by finding the Ninjutsu item throughout the game. The number of uses of ninjutsu is retained between rounds but not if the player loses a life.
The ninjas share a life gauge, which is diminished each time a ninja takes damage from an enemy weapon. It can be replenished by finding a Heart item. Each round (except the last) contains a Power-Up item that permanently augments the player's life gauge. Touching an enemy but not a weapon knocks the ninja back without doing damage. If a ninja loses the entire life gauge, the player loses a life. If the player runs out of lives, the game ends, but it can be continued. The game also has a password system for continuing at a later time.
The Red Ninja is initially available, but the others must be unlocked by completing rounds.
Main Weapon: Short-ranged, 180-degree sword slash towards the front.
Special Technique: None.
Ninjutsu: Teleportation. Teleports to the beginning of the round or to a Transport item if found.
Main Weapon: Manriki-kusari. Blade with a long chain. Powerful and medium range.
Special Technique: Swinging from grappling points by hitting them with the end of his weapon.
Ninjutsu: Tatsumaki. Turns into a whirlwind and flies around the screen. Can be controlled. Use it to reach high places. Also damages enemies it touches while flying.
Main Weapon: A large shuriken with sharp edges that returns to the user after throwing, similar to a boomerang.
Special Technique: Walking over water.
Ninjutsu: Ikazuchi. Creates a lightning barrier that protects the user from damage until it takes enough damage or disappears.
Main Weapon: Short-ranged but powerful bombs.
Special Technique: Walking on ceilings by jumping and holding on the ceiling. Release to drop off the ceiling. The ninja cannot attack while on a ceiling.
Ninjutsu: Flash. Creates a blinding light that stuns the enemies and illuminates dark areas.
Main Weapons: Small shurikens, weak power but longest range.
Special Technique: Double jump by jumping and pressing again at the height of the jump. Pressing during the double jump fires 5 shurikens towards the ground, similar to the special attack in Revenge of Shinobi and Shinobi III.
Ninjutsu: Earthquake. Damages all enemies on the screen and destroys cracked boulders.
Items are revealed by breaking open item boxes and then can be collected by moving onto them.
Replenishes two points on the player's life gauge.
Gives the player another opportunity to use a ninja's ninjutsu ability.
Allows the Red Ninja to teleport to the location of this item when using his Teleportation ninjutsu.
Permanently increases the player's life gauge by two points. There is one hidden in each of the first four rounds.
Gives the player an extra life.
The objective of the game. One is found in each stage.
Explodes and damages the player if in range.
The first four rounds are available immediately and can be played in any order. Each contains an Elemental Crystal and unlocks a different ninja as a playable character once completed. Rounds can be replayed after they have been completed, and each contains areas and items that can only be accessed by a particular ninja's abilities.