Strange events are taking place in Okinawa. An Azumi priestess has a terrifying vision of a city being destroyed by a giant monster. A type of metal not found on Earth is discovered in a cave by a spelunker, Masahiko Shimizu, who takes it to Professor Miyajima for examination. An excavation led by Masahiko’s brother Keisuke accidentally uncovers a chamber filled with ancient artifacts and a mural bearing an ominous prophecy: “When a black mountain appears above the clouds, a huge monster will arise and try to destroy the world; but when the red moon sets and the sun rises in the west, two monsters shall appear to save the people.” Keisuke is joined by archaeologist Saeko Kaneshiro, who translates the prophecy and takes one of the artifacts, bearing the likeness of the legendary monster King Caesar, to study. Two men stalk them, one who speaks to them and claims to be a reporter interested in the story, the other of whom attempts to steal the statue from them but fails and flees.
Before long, the first sign appears in the form of a black cloud that looks like a mountain. Godzilla (or so it seems) emerges from Mount Fuji and begins a destructive rampage, despite the fact that he has become tolerant of humans within the last few years. Anguirus, usually Godzilla’s ally, confronts him, only to be nearly killed and forced to retreat, but not before inflicting a wound that exposes something shiny and metallic beneath Godzilla’s skin. Keisuke arrives shortly after to make sure that his brother and the professor are out of harm’s way and discovers another sample of the strange metal. Godzilla’s rampage continues, at an oil refinery, until another Godzilla emerges and begins to battle it. During the fight, the challenger is revealed to be the true Godzilla, while the other turns out to be Mechagodzilla, a massive robot armed with advanced weaponry in disguise as Godzilla. After Mechagodzilla’s disguise is intentionally burnt off, the battle resumes. The real Godzilla is severely wounded, but inflicts some damage on the machine; both monsters retreat hastily. Miyajima hypothesizes, based on Mechagodzilla’s advanced technology and composition of unearthly metals, that the robot is an alien super weapon.
Keisuke and Saeko take the statue of King Caesar back to the temple by cruise ship, but are confronted by the thief once again. During the fight, the stranger’s head is wounded and the skin on half of his face melts away to reveal an apelike visage. The intruder attempts to kill Keisuke and nearly succeeds, but a bullet from an unseen gunman kills him and propels him overboard. Keisuke and Saeko catch a brief glimpse of the “reporter” once again. Meanwhile, Godzilla arrives on Monster Island during a thunderstorm and is struck by lightning multiple times, seemingly reinvigorating himself.
Masahiko, Miyajima and his daughter Ikuko go to explore the cave where the metal was first found and are captured by the apelike aliens from the Third Planet of the Black Hole, who plan to use Mechagodzilla to conquer Earth. Their leader, Kuronuma, forces Miyajima to repair the robot. While Saeko checks into a hotel and guards the statue, Keisuke goes to meet his brother at the caves and instead encounters the reporter, who explains that his name is Nanbara and he is actually an Interpol agent who has been tracking the aliens. Nanbara and Keisuke infiltrate the alien base and free the prisoners. The team then splits up, with Miyajima, Nanbara, and Masahiko returning to the alien base and get recaptured by Kuronuma, while Keisuke and Ikuko pick up Saeko and the statue from the hotel.
In the early hours of the morning, a lunar eclipse results in a red moon and a mirage creates the illusion of the sun rising in the west. The team realizes that the time has come to awaken King Caesar. They meet with the Azumi priestess and her grandfather, and place the statue on a platform in the temple, revealing the lion-like monster’s resting place. However, just then, Kuronuma dispatches Mechagodzilla. The priestess sings a song that awakens King Caesar, and Godzilla appears shortly afterwards. King Caesar and Godzilla fight together against MechaGodzilla. Eventually, Godzilla uses the electricity stored in his body from the lightning to create a magnetic force field that ensnares the robot and attracts it to Godzilla’s body, then tears off its head, causing it to explode into little pieces of metal that fall into the ocean. While the mortified aliens are distracted, Nanbara and the others free themselves, kill their captors, and sabotage the base, fleeing as it explodes. With the enemy defeated, Godzilla heads out to sea and King Caesar returns to his resting place, while the heroes rejoice.