Iron Soldier 2 puts you back in the pilot's seat of a 42 foot tall humanoid war machine. The old Iron Fist corporation is gone, and a new democratic republic has been set up. The peace is short lived, though. Iron Fist's rival, PENTA corporation, is now threatening the United Republic's stability. You are a pilot for the United Republic, and must stop PENTA's advances.

Iron Soldier 2 plays similarly to the first game. You have new weapons, new enemies, and 20 super-challenging missions to contend with.

Originally released on CD, Telegames later released a cartridge version, featuring the same gameplay as the CD version, but lacking music as well as having had the FMV sequences replaced with still images due to space constraints.