In the Fera Islands in winter, 1938, Major Sebastian Bludd leads an assault squad against a defenseless town. They smash their way into a place of worship, where Bludd finds what Cobra Commander believes is an ultimate weapon - a strange glowing object inside a statue. Bludd is unimpressed, but when he touches it, the building starts to collapse! He thinks it's started an earthquake, but it is in fact the awakening of a giant robot! Megatron tells Bludd that he has found the ultimate power - he has awakened the Decepticons!
In summer of 1939, in Arlington, VA, Sergeant Lorenzo Wilkinson reports for duty. A man named Flint welcomes Wilkinson to something called the Pit, telling him there's a general waiting down the hall to address him and the rest of the best - G.I. Joe.
Wilkinson is followed by a mysterious man who tosses Flint a pair of dice, with snake eyes showing, revealing his identity. Flint chews him out for tossing dice at him and begins to tell him to go meet the general - but Snake-Eyes is already gone.
Soon, in the briefing, the general tells his new team that for the past two years, the United States has been concerned about developments in Europe and in the Pacific Rim. Things have taken a turn for the worse - a team of 12 intelligence operatives went into Western Europe and only two came back.
The two returning operatives - Jaye and Scarlett - take over the briefing. They show images of France's famed Maginot Line, devastated; of Paris, overrun; of Rome, conquered. The emblem on the flags of the conquerors appears to be a Cobra.
The general tells the room that the nation is not prepared for a second world war. The task of G.I. Joe is to break the Cobra's fangs before it comes to that.
Snake-Eyes suddenly notices something up near the ceiling. It has wings, and a vulture's head, and as Duke takes aim with his pistol, it retaliates with a laser that slices the gun in two and pierces Duke's hand. The creature flies away....
24 hours later Laserbeak arrives in the Fera Islands, at Cobra's TerrorDrome headquarters, and reports to Soundwave, revealing the Americans' assault plans. Destro believes they must withdraw forces from Europe to defend the Fera Island and the TerrorDrome. Cobra Commander reminds him that no one knows the fortress even exists outside of Cobra, and if the heroes do find them, they will crush them all. Starscream agrees, saying heroes are born to die - heroes and fools.
At Sumburgh RAF base in Scotland's Shetland Islands, the Joes prepare for a night drop. Grunt complains that they have no intel, no backup, no transports, no artillery and no armor - they're going to get eaten alive. Scarlett shows them a chunk of a battleship hull with a map apparently gouged into the side of it - a map of the Fera islands, along with two symbols - the Cobra, and another they don't recognize. They don't know who made it where it came from, but that's where they're going.
Soon the Joes are on board their plane heading for the drop zone. Along the way they're buzzed by three flying objects - Megatron, Starscream and Soundwave, heading towards Britain. The three Decepticons make quick work of the RAF planes they meet, and prepare to conquer London.
Six hours later the Joes drop into the Fera Islands. Duke is worried that the team hasn't had enough time together to actually function as a team, when they're attacked by a sniper. Two Joes go down, but Snake-Eyes recognizes the sniper - Stormshadow. Stormshadow easily bests his "brother," as he calls Snake-Eyes, in combat, and takes his sword to Snake-Eyes' face...
The Joes retreat into the ruins, and Duke laments about losing so many men. Before they get too far, though, Duke sees something he doesn't expect - a giant metal monster head in the ruins...
Having escaped the ambush from the combined Decepticon and Cobra forces, the remaining G.I. Joe assault team members: Duke, Roadblock, Leatherneck and Scarlett: barricade themselves in the ancient ruins around them: ruins which include the deactivated bodies of more giant robots.
In digging through the ruins, though, they accidentally reactivate the robots' repair system. It launches a satellite to explore and assimilate data, data that it will use to repair the fallen Autobots.
Starscream observes the satellite and says ominously, "my star is rising."
The first Autobot repaired is Ironhide. The Joes quickly attack, but their bullets bounce off him. He manages to catch them before they hit anyone, and tells them to be careful: someone could get hurt.
Not far away, Snake-Eyes and Stormshadow duel on the battlements of the Cobra fortress. Stormshadow has the upper hand and cuts Snake-Eyes across the face, several times. Snake-Eyes holds him off long enough for Stalker to arrive, and Stormshadow is forced to run from Stalker's attack.
Stalker tells Snake-Eyes he's got to get back to Scarlett, their nurse, so she can take a look at his ravaged face. But Snake-Eyes ignores the pain, and takes off after Stormshadow. Stalker says he's seen the way Snake-Eyes and Scarlett look at each other, and he knows she wants to get to know the man behind the mask... but the man doesn't have a face to show her anymore.
Snake-Eyes follows Stormshadow through the forest, stealthily enough to see Stormshadow contact a group of Cobras in a foxhole to set up an ambush. Snake-Eyes sneaks around behind them, and takes them all out before they can make a sound. But he realizes he's lost too much blood. There's only two things that stoop the flow of blood: time, and fire. Since he's out of time, he throws some gunpowder on his face and stands in front of a flamethrower...
Stormshadow calls out to Snake-Eyes, asking him if he's too much of a coward to face him alone. Of course, he's hoping to draw Snake-Eyes into his ambush. Snake-Eyes tosses him the helmet of one of the Cobra troopers, letting Stormshadow know just what he thinks of his ambush. Stormshadow runs.
Back in the ruins, a now reactivated Optimus Prime explains to Duke how the war between the Autobots and Decepticons on Cybertron led them here. Grimlock, Jazz, Prowl, Bumblebee and Hound have also been reactivated. Prime says they have no idea what's going on now, which angers Leatherneck: he says nothing's changed, the Decepticons are just attacking defenseless earth cities. He reminds the Joes that they have a mission to attend to. Hound and Ironhide want to tag along, but Prowl reminds them they don't know what's going on. Grimlock agrees with Leatherneck: regardless of where they are or how they look now, the only good Decepticon is a smashed one.
Starscream continues to eavesdrop, but Megatron sneaks up on him, furious that he's allowed the Autobots to become reactivated. He tells Starscream that no matter what he's plotting, he will never posses the Matrix, or lead the Decepticons. He tells Starscream to transfer the energon cubes to a secure location, and then they'll destroy the Autobots once and for all.
Meanwhile, Destro informs Cobra Commander that they've lost contact with several outposts and with Stormshadow. To Destro's dismay, the Commander sends Wild Weasel and a squadron of Rattlers for recon. He then turns to a monitor bank and addresses a blurry face: "Zartan... come out and play."
Wild Weasel's squadron catches Duke's unit out in the open. Luckily for them, Grimlock's on the scene: in his new tank mode! He blasts a couple of Rattlers out of the sky, confusing Wild Weasel: "I thought the death machine men from the abyss were on our side!" Cobra Commander orders a retreat until the Decepticons can arrive.
Elsewhere, Snake-Eyes enters the Cobra castle in pursuit of Stormshadow. Donning a face mask and borrowing a sword from an ancient body of armour, he finally comes face to face with his blood brother. Stormshadow suggests that Snake-Eyes slay himself, and receive a clean death: because Stormshadow's new friend, Ravage, will offer no such mercy...
The second G.I. Joe strike team, consisting of Flint, Lady Jaye, Beach Head, Breaker, Grunt and Lifeline, waits patiently for the signal from the first team that Cobra's communications systems have been knocked out. When the Cobra/Decepticon seeker jets fly by overhead, Breaker suggests they call in the fleet now: but Flints reminds him of their orders. Once the comm systems are down, team two has to take out the enemy airfield: and then the fleet can be called in.
Elsewhere, Stalker, having been separated from team one, searches for his comrades. After taking out a wandering Cobra, he's almost stepped on by an Aerialbot! The Aerialbot leads him to his teammates, who he informs of his bad news: he lost Snake-Eyes. Duke won't believe it until he sees a body, but Scarlett is visibly upset. Bumblebee tries to help by reminding them that Stalker was lost as well, but he was found.
Before they can look for him, however, Cobra paratroopers begin to descend from the skies, and the Joes and Autobots begin to take heavy fire.
Meanwhile, at the Terror Drome several miles away, Megatron orders Cobra soldiers to move his energon cubes aboard a submarine. Cobra Commander reminds him that he is in charge, and when Megatron objects, the Baroness points her gun: filled with explosive, armor-piercing bullets: at the Decepticon leader's eye. Megatron laughs, but the Commander reveals that he has the Matrix: and he knows how to use it. With it he can inflict pain on, and therefore control, the Decepticons. Megatron relents... for now.
Not far away, Storm Shadow watches as his blood brother Snake-Eyes fights the Decepticon panther, Ravage. Snake-Eyes demonstrates just how capable a warrior he his by quickly dispatching of the beast with a grenade. He then fights his way through another trio of Cobra soldiers before once again facing off with Storm Shadow. They fight, and Snake-Eyes gains the upper hand: but will not kill Storm Shadow. Storm Shadow mistakes this for weakness, and leaps down to a gun emplacement. Before he can turn the weapon on Snake-Eyes however, he learns that Snake-Eyes is not necessarily so merciful: a grenade falls on the ground beside him. Storm Shadow is finished.
The explosions are the signal Flint is looking for. He decides it's time to make the call, and goes to find Breaker. Unfortunately, Zartan has emerged from the water nearby and killed Breaker, taking his place. Flint approaches, and having no idea that Breaker is Zartan in disguise, begins detailing the next steps of the plan...
Elsewhere, Roadblock and Grimlock continue to plow through Cobra gun emplacements, not realizing one of the soldiers is actually not a Cobra at all: it's Rumble in disguise. He transforms his arms to piledriver mode and opens a chasm right in front of the oncoming Autobot tank...
At the Fera Islands, Flint orders Breaker to call in the American invasion force. But he quickly realizes the radio Breaker's using is not theirs: nor is Breaker the same. Flint orders the rest of the team to proceed to the airfield while he takes care of "Breaker": who is now revealed as Zartan.
The two fight, but Zartan has backup: Soundwave. He snatches Flint up, and Zartan tells him to keep him intact, because he knows the Joes' battle plans. Soundwave takes Flint and Zartan back to the Terror Drome.
The rest of Flint's unit takes the airfield with ease: it appears to be unguarded. Beach Head goes on to the tower himself, to find a radio, and tells the rest of the team to get a plane running: if all else fails they can call the fleet from the air.
On an adjacent island, Rumble continues his assault on the Autobots and Joes. They're forced to fall back before the opening fissure, but Scarlett has other ideas. She hopes on top of Bumblebee in his motorcycle mode, and the pair makes a beeline for Rumble. Scarlett uses the "riptide" effect of his earth-shaking as a ramp, and as she and Bumblebee sail over Rumble's head, she deftly drops a grenade on him.
But it doesn't look like it's enough to save Grimlock. The crumbling ground is forcing him down the cliff into the sea, and he tries to hold on long enough for Roadblock to jump off of him, lest he fall in too. But Roadblock tells him "we don't try around here: and we don't quit!" Inspired, Grimlock hangs on long enough for the Aerialbots to merge into Superion and carry him away.
A mile to the north, Stormshadow: somehow having survived Snake-Eyes' grenade attack: attacks again. The pair fight, and Snake-Eyes flashes back to their younger days, recalling everything Stormshadow has since taken from him. As they fall into the water, Snake-Eyes thinks that he has nothing left to lose: nothing but the man who was once his friend and brother. A shark attacks and devours Stormshadow...
At the Terror Drome, Starscream and Destro meet secretly in hidden chambers. Destro reiterates their plan: for the Autobot/G.I. Joe forces and Decepticon/Cobra forces to wipe each other out, leaving the power for Destro and Starscream. And to help them in their goal, Destro reveals the ultimate fusion of Decepticon technology and Destro's own expertise in the art of Destruction: Bruticus!
At the airfield, Beach Head climbs into the tower in search of that radio. Before can make the call, though, he is attacked by Frenzy. On the tarmac, Lady Jaye sees the tower go up in flames. She doesn't know if Beach Head survived or not, or if he got the call out: so they have to take their plane up and try and make the call themselves. Up above, though, Wild Weasel sees their plane taking off...
After a bloody battle with Storm Shadow, Snake-Eyes carries the dying Storm Shadow to a safe place, Storm Shadow's last words are "tell me you understand". Ravage attacks Snake-Eyes from behind, but Snake-Eyes is faster and strikes a killing blow on Ravage.
Destro, Baroness and Dr. Mindbender are torturing the captured Flint asking him about the invasion force that is coming to attack the Cobra fortress.
Beach Head is being chased by Frenzy and his plan is to have Grunt fire his artillery piece when needed. Once Beach Head sets a small explosive on an airplane, he lures Frenzy to the plane, he gives Grunt the signal and Grunt fires, blowing up the plane and destroying Frenzy.
Lady Jaye, in a stolen plane on her way to send the invasion signal, is being chased by Wild Weasel. Doing a slow turn Lady Jaye is able to get into a position to destroy Wild Weasel. She is able to send the signal to Hawk and the invasion force is launched.
Cobra Commander orders all of his slaves brought in as a line of defense against the invasion force. And his back up is Shockwave, who transforms into a massive cannon.
Snake-Eyes, Beach Head, Scarlett, Roadblock and the rest of the Joe team join up with all of the Autobots to continue there attack on the Cobra fortress. The beginning of the attack is supposed to have Superion going in to cover the slaves as Snake-Eyes and Stalker clear them out. But before the plan can get started Superion is almost destroyed by Shockwave. Cobra Commander believes he is about to win.
Grimlock, Bumblebee, Stalker and Roadblock are trying to make an attack on Shockwave. Shockwave in cannon form has been destroying lots of the invasion force and preventing any advance. But he is running low on energy and can't continue his firing. Cobra Commander refuses to allow him to recharge.
Lady Jaye and Duke are surrounded by Major Bludd and the Dreadnoks, after a short fight Flint arrives to help out, but Lady Jaye realizes that it is actually Zartan in disguise and kills him. Duke helps defeat Major Bludd.
The Autobots and Joes have successfully made there way to outside of the fortress. Destro releases his new creation Bruticus, a Transformer that is human made and owes no allegiance to either faction of Transformer only to Destro. Grimlock and Snake-Eyes attack Bruticus, first he is shot by Grimlock and Snake-Eyes' throws a grenade into the damaged area, completely destroying Bruticus but during the ensuing fight with Bruticus part of the fortress collapses, trapping Cobra Commander in the rubble. The Commander demands Megatron to free him. Megatron refuses to help and leaves Cobra Commander to go a seek out the Matrix.
In another part of the Fortress, Destro and the Baroness reveal their love and allegiance then kill Starscream. The Baroness then goes to remove Cobra Commander and gain control of the Matrix.
Optimus Prime is concerned that Megatron has not shown up in the fight goes to confront him directly and win the control of the Matrix. In Cobra Commander's chamber, the Baroness has arrived to see the trapped Commander instead of helping him like he is demanding, she kills him. Scarlett, who has secretly made it into the Cobra's fortress, gets the drop on the Baroness. At the same time, Megatron gets control of the Matrix. As Megatron is growing in power, the only way to stop him is to destroy the Matrix. So Prime attacks Megatron and destroys the Matrix. The explosion of the Matrix kills both Megatron and Optimus Prime. Prime sacrifices himself to save the world and end the war.
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