Windsor College seniors Maureen Evans and Phil Stevens attend a sneak preview of Stab, a film based on the events of the first film. During the movie, Phil uses the restroom and is killed by Ghostface. Ghostface enters to the screening and sits beside Maureen, who thinks it's Phil trying to scare her before finding blood on his cloak. Ghostface fatally stabs her, which the audience mistakes for a publicity stunt until Maureen falls dead in front of the movie screen.

The following day, the news media, including local journalist Debbie Salt, descend on Windsor College where Sidney Prescott studies alongside her best friend Hallie McDaniel, her new boyfriend Derek Feldman, fellow Woodsboro survivor Randy Meeks and Derek's best friend Mickey Altieri. Two other Woodsboro survivors arrive at the campus: police officer Dewey Riley to help Sidney and reporter Gale Weathers to cover the case. Gale tries to stage a confrontation between Sidney and Cotton Weary, who is attempting to gain fame from his exoneration for the murder of Sidney's mother, Maureen Prescott. After Gale forcibly confronts Sidney with Cotton, Sidney angrily hits Gale.

Later that evening, Sidney goes to a party with Hallie. At a sorority house, Ghostface murders student Cici Cooper. After all the partygoers leave, Ghostface crashes the party and attacks Sidney, though Derek intervenes. Ghostface injures Derek but flees when the police arrive. Later, after realizing that Cici's real name is Casey, Gale theorizes that the new Ghostface targets students having the same names as the Woodsboro murder victims.

Gale, Dewey, and Randy are talking on the campus lawn when Ghostface calls, hinting that he is watching them. Gale and Dewey decide to search for him while Randy keeps him talking. As Gale and Dewey are looking around the campus, Ghostface drags Randy into Gale's broadcast van and murders him. As night falls, Dewey and Gale review the tape of Ghostface killing Randy. The killer attacks them, stabbing Dewey while Gale escapes. Two officers drive Sidney and Hallie to a local police station, but Ghostface murders them. In the ensuing struggle, Ghostface is knocked unconscious, but soon revives and kills Hallie, prompting Sidney to flee.

Back at the campus, Sidney finds Derek in the auditorium tied to a cross. Sidney begins to untie him when Ghostface arrives. The killer reveals himself to be Mickey and shoots Derek, killing him. Mickey tells Sidney that he intends to kill her and allow himself to be arrested so he can blame violence in movies for the murders at trial and be acquitted on the grounds of insanity, with the help of Alan Dershowitz or Johnnie Cochran as his defense attorney. He then introduces Debbie Salt as his accomplice, whom Sidney recognizes as Mrs. Loomis, the mother of Billy Loomis, who is seeking revenge against Sidney for killing her son.

Mickey explains that Mrs. Loomis paid for Mickey's tuition fee in exchange for his killings. Mrs. Loomis then betrays Mickey and shoots him. Before Mickey collapses, he shoots Gale, causing her to fall off the stage. Sidney and Mrs. Loomis fight, until Cotton intervenes and Mrs. Loomis holds a knife to Sidney's throat. When Mrs. Loomis attempts to persuade Cotton to let her kill Sidney, Cotton shoots Mrs. Loomis in the chest. As they debate whether or not Mrs. Loomis is really dead, they find Gale still alive. Mickey suddenly resurfaces and attacks the group, to which Gale and Sidney respond by violently shooting him to death. Sidney turns to Mrs. Loomis and shoots her in the head to ensure she is dead.

When the police arrive the next morning, Dewey is revealed to still be alive and Gale climbs into the ambulance with him rather than taking the opportunity to report to the cameras on the murders, showing that by the end of the movie she cared more for Dewey than for the notoriety she always sought. Sidney instructs the press to direct questions to Cotton, rewarding him with the fame he has been chasing while removing the attention from herself as she leaves the university campus.