In this thrilling follow-up to Bill & Ted's Excellent Adventure, the legendary music created by Bill and Ted's band, Wyld Stallyns, has ushered in a utopian society. However, their success attracts the ire of Chuck De Nomolos, a villain who despises the peaceful world formed by their melodies. Intent on changing history, he steals a time-traveling phone booth and dispatches two rogue robots, modeled after Bill and Ted, back to the late 20th century, intending to sabotage the San Dimas Battle of the Bands. Despite the interference, Rufus tries to thwart De Nomolos's evil plan but mysteriously finds himself lost within the labyrinth of time.
Fast forward five years from their initial time-traveling escapade with Rufus, Bill and Ted are gearing up for the ultimate musical showdown. Their fiancées, Elizabeth and Joanna, former 15th-century princesses, have grown into capable musicians alongside them. Yet, the duo still struggles as singers and songwriters. Encouraged by the event organizer, Ms. Wardroe, they are promised a coveted spot to headline the contest. Meanwhile, Bill's young stepmother Missy has divorced his father, opting for a relationship with Ted's dad, who ominously threatens military school should they fail.
When the evil versions of Bill and Ted arrive, they deceive the duo and eliminate them by tossing them off a cliff at Vasquez Rocks. The malicious robots not only replace them but also treat the princesses with rudeness, further jeopardizing Bill and Ted's hard-earned fame. In death, their souls encounter Death himself, who challenges them to a game for their afterlives. After outsmarting him by pulling off a "melvin," they flee, though their attempts to reach their families prove futile. During a séance conducted by Missy, they are cast into Hell, where they face their deepest fears, including the daunting figures of Col Oates, the Easter Bunny, and Granny S. Preston. It becomes clear that the only way out is to accept Death's offer.
In Death's chambers, they choose to play modern games like Battleship, Clue, and Twister, triumphing effortlessly. Defeated but not entirely pleased, Death begrudgingly becomes their ally. Recognizing the need for assistance, Bill and Ted seek the smartest being in the universe to help create reliable robots to counter De Nomolos's evil creations. Death guides them to Heaven, where, with divine help, they meet an alien named Station who can divide into two identical beings and eagerly agrees to aid their cause.
As the Battle of the Bands night arrives, Bill and Ted enlist Station's help, leading him to a hardware store where he constructs benevolent robots. Just in time, they arrive at the concert to confront the evil robots and manage to defeat them. However, De Nomolos shows up, threatening to take down Bill and Ted himself, utilizing the broadcast equipment to display their struggle worldwide. With quick thinking, the duo realizes they have the ability to leap back in time to trap De Nomolos, aided by Death and Station. Although De Nomolos attempts the same strategy, Bill and Ted outmaneuver him, successfully capturing him through the insight that only victors can rewind time. With Ted's father apprehending De Nomolos, they gain a foothold in the situation.
Revealing her true identity, Ms. Wardroe is unmasked as Rufus, who had ensured Bill and Ted's assured entry into the concert. As they reunite with their fiancées, the reality sets in that they still lack musical talent. The four decide to use the time booth for practice, jumping back to find they have mastered their instruments after what they claim was "an intense 16 months of guitar training, plus a two weeks honeymoon." They emerge as accomplished performers, each with their respective babies, "Little Ted" and "Little Bill."
In a breathtaking finale, they begin to perform a powerful rock ballad enriched by the presence of Death and Station, along with their good robots. The broadcast initiated by De Nomolos wraps around the globe, echoing Wyld Stallyns' music and fostering universal harmony. As the credits roll, newspaper articles reveal the group's journey of fame, culminating in their ambitious tour to the planet Mars.
