Ken and Ryu land in Hong Kong. They take a cab to a very expensive hotel. On the way there, the cab driver asks if they are in Hong Kong for business or pleasure. Ryu answers him saying, "training!". At the hotel, Ken goes up to the check in counter and asks for a room. The manager apologizes to Ken, saying that there are no rooms available. Ken inquiries as to the status of the penthouse. He apologizes for not making himself clear the first time. Hector, the general manager, of the hotel informs Ken that the penthouse costs 20,000 U.S. dollars a night. Ken shrugs it off and pulls out his gold cards. Hector tells him they will have to charge a deposit, Ken accepts this. After the card clears. Hector starts adding 'sama' to Ken's name to be more polite and respectful towards his rich guest. Ryu and Ken are treated to an elevator ride to the 78th floor. The elevator is for the exclusive use of the penthouse guests. The penthouse is huge. Ryu comments that there is plenty of room to train. The two go at it, in a very fluid motion sparring match. Ryu winds up busting through the doors out onto the balcony, where he discovers a swimming pool. Ryu dives in. Meanwhile, Ken is making plans for them for a night on the town. He asks the hotel to arrange a tour guide. Ryu tells Ken to come on in to the pool. This is Ken's butt scene, he strips down and dives in at Ryu.

The area they are in is pretty quiet. The buildings look like they are in a war zone. The three hear some men discussing how they are going to bet in tonight's matches against the champion. Ken, Ryu and Chun-Li follow the men to where the fights are being held. Ken gives the guys at the door $300 to get them in. The place is packed. The ring announcer informs the crowd that the next challenger to the champion will not be making it tonight. It seems he was killed earlier in a shoot out with Hong Kong police. The betting will end if someone doesn't challenge the champion. Ken gives Chun-Li a wad of money and asks if she has ever gambled before. She tells him no. Ken tells her to just bet all the money on either himself or Ryu. Ken is aboutto enter the ring when Ryu jumps ahead of him. The champion is huge and has a roll of fat surrounding his body. The Master of Kowloon Castle and his lackey watch from a private room. The bell rings, Ryu flies against the ropes!! FLYING SIDEKICK! The champion drops faster than a rock in water. We have a new champion!!!! The Master of Kowloon Castle is mad, he yells at his lackey to get more fighters in the ring. Meanwhile Chun-Li collects a ton of money and places it all again on Ryu. Three new fighters enter the ring. They are no match for the power of Ryu. The Master is highly upset. Call in Mr. DalDoh he barks at his lackey. DalDoh is THE CHAMPION of Kowloon Castle. DalDoh is huge, much bigger than the initial guy. He pummels Ryu and knocks him into a corner. Ken rushes forward asking if Ryu is alright and if he should finish this match for him. Ryu tells him that he wants to continue, it's not every day that you get a catch like DalDoh he explains. Ryu gets in a few good hits on DalDoh, then winds up getting getting beaten up some more. DalDoh grabs Ryu by the shirt and holds him up in the air and begins to laugh. Ryu turns his head toward DalDoh and chuckles , "heh, heh, heh", then goes wild on DalDoh. He starts pounding away on Daldoh against one of the rings corners, all the while screaming about a "monster". Finally , to finish off Daldoh, Ryu grabs him by the his mohawk, jumps up to the top of the corner post and flies down , smashing DalDoh's head into the ground. Yatta! He did it! DalDoh is out cold. The Master of the evil cave is furious. He barks out his commands, "they have dishonored the evil cave, don't let them leave alive!". People start charging Ken and Ryu left and right. Chun-Li's winnings going flying into the air. The three make a break for the door. The Master's men give chase. The Masters has put a reward out for their deaths. Ken, Ryu and Chun-Li run off into the night, being chased.