After the events of the previous game, many members of the former space crew moved on to work on the S.S. Strange Terror, a large submarine built out of recycled wreckage from the space lab, used for containing strange monsters and delivering them to paying clients. One night, strange human-like screaming is heard coming from nearby the containment zone, causing a few employees to open the area up to check it out. The monster is then revealed to have escaped containment and killed most of its handlers. It kills the two investigating employees offscreen, and with the door to the rest of the ship now open, goes on a massacre across the sub. Jay/Alice is caught in the chaos, and needs to find a way to either escape the submarine or kill the monster. The game has many different endings, and who survives is up to the player's skill and choice.