The Mad Monk

The gods in Heaven complain to the Jade Emperor about Dragon Fighter Lohan's malicious jokes on mankind. The Jade Emperor summons Dragon, but Tiger Fighter Lohan appears to defend his friend. Dragon rebukes the gods for their horrible judgments and asserts he can do better. Guan Yin intervenes as the Jade Emperor banishes Dragon and Tiger to be reincarnated as animals, issuing a dare to change the fates of three people.

The Bodhisattva gives Dragon a magical fan to aid his mission, but Tiger seizes it just before Dragon is forced down from Heaven. Dragon and Tiger are banished to be reborn as animals, starting their parallel journeys. The stolen fan becomes the symbol of Dragon's quest on Earth while Tiger watches from afar.

Dragon is reborn to a couple who visit a Buddhist temple to pray for a child. Tiger is reincarnated as well, but is younger and physically slower to mature. Unicorn, a heavenly soldier, helps ferry the magical fan to Dragon, while Dragon's parents adopt Tiger and treat him as their own son.

Dragon regains his memories after being struck by lightning during an encounter with Bai Xiao Yu, the prostitute. He also encounters Ta Chung the beggar and Yuan Ba Tian the villain, reawakening their intertwined fates. When the moon is obscured, Tiger regains enough presence to pass the magic fan to Dragon before returning to Heaven.

Dragon tries to instill dignity in Ta Chung, persuade Xiao Yu to leave prostitution, and urge Yuan Ba Tian to reform. He arranges a date for Ta Chung and Xiao Yu, hoping their change of path will fulfill his bet.

Yuan attacks Dragon during the date and murders Ta Chung. He then forces Dragon to watch as he assaults Xiao Yu. Ta Chung dies, but he regains dignity by recognizing his own name in the moment of death.

Dragon retrieves the holy relic Golden Skeleton, his body from a former life. He travels to the underworld, confronts a demon, and trades the skeleton for Ta Chung's soul. The demon keeps both the soul and the relic and returns Dragon to the land of the living.

Dragon rushes to the temple but finds that the local gods have left, shunning him due to his deal with the demon. He promises to marry Xiao Yu if she gives up prostitution, but the moment he begins to transform into a tree—due to a mortal-god marriage prohibition—she fears it is a joke and hesitates.

Yuan slaughters everyone in the brothel to purge the relic of its power. Dragon confronts Yuan, regains his form, and discovers Yuan has been granted an invincible body by the demon. Dragon tears out Yuan's heart to reveal the demon's stone-hearted power, and Yuan dies with remorse, seeking rebirth as an animal.

Dragon is offered a chance to return to Heaven but stays to protect Earth. He infuses the relic's power into golden paint and uses it to inscribe protective talismans around the temple. The demon blows away the talismans and chases Dragon; fleeing, Dragon asks the temple Abbot for help, who makes the demon laugh, allowing Dragon to dive into the demon's mouth and cause its explosion.

The gods celebrate as Dragon seems to have lost the bet, but Guan Yin interrupts to reveal his success. Ta Chung has been reborn into a wealthy, loving family; Xiao Yu has abandoned prostitution and opened a bean curd restaurant; Yuan has renounced violence and is reborn as a pig. Dragon's victory is thus proven through transformed lives.

Dragon is crowned with a tiara and a scepter in a mock pageant as the gods cheer. The Jade Emperor and the assembly acknowledge that he has changed the fates of the three people. The final scene seals Dragon's status as Earth’s protector and a revered figure among the gods.