A French priest named Moreau warns the monks of a monastery about an impending attack by the devil's forces to obtain a boy named Danny. The monastery falls under attack; Moreau tries to help the boy and his mother Nadya escape, but the distrusting mother shoots at Moreau and flees with her son. Moreau manages to distract the men chasing Danny and Nadya, but nearly dies in the process and loses them. He believes that only the Ghost Rider is capable of protecting the boy. He finds the Rider and seeks his help.
Eight years have passed since the events of the first film, which dealt with Johnny Blaze making a deal with the demon Roarke (Mephistopheles), and becoming the Ghost Rider — a vengeful, fiery spirit who feeds on the evil of his victims and consumes the souls of sinners. No matter how small the infraction — anything from genocide to a white lie — the Rider does not differentiate. This drives Blaze into hiding, fighting the evil spirit within him. Moreau finds him with some ease and convinces him to save the boy in exchange for his priesthood's ability to restore Johnny's soul and remove the Ghost Rider's curse forever. Meanwhile, pursuers force Nadya and Danny from the road and bring them to their leader: her former boyfriend Ray Carrigan. Carrigan has Danny tied up and is about to execute Nadya when the Ghost Rider appears; the Ghost Rider kills several of Carrigan's men and then moves in on Danny. Nadya distracts the Ghost Rider, who then is shot with grenades into submission. Carrigan leaves with Danny in tow.
Johnny wakes up the next morning in a hospital. On the way out, he convinces Nadya not to trust him, but to accept his help to find Danny. However, Carrigan tells Roarke about the Rider, and Roarke speaks an incantation to Danny via phone; this, in effect, puts up a "firewall" preventing the Rider from sensing his whereabouts. He warns Carrigan it will not shield him from being sensed and gives him instructions to deliver Danny. Nadya later tells Blaze that as she lay dying, she made a deal with Roarke: her life in return for him impregnating her with Danny, making Danny a direct vessel for Roarke and the potential for him to have unlimited power on the surface world. Roarke lacks this power so far from Hell. Danny nearly escapes, but breaks his ankle and is recaptured. That night, Nadya and Johnny interrogate a known contact of Carrigan's. Johnny takes off ahead of Nadya to deal with Carrigan. Nadya saves Danny as the Rider converts a mining machine (a Bagger 288) into a massive fiery machine, destroying their hideout complex and mortally wounding Carrigan. When Ghost Rider catches up to Nadya and starts to use his Penance Stare on her, Danny is able to stop the rider with a word, exercising his hidden power.
Moreau catches up with the group as they ride off. Roarke is not done with Carrigan; using his power, he turns Carrigan into a demon called Blackout capable of instantly decaying anything he touches while shrouded in darkness. Johnny and Nadya bring Danny to Moreau's monastery with warm reception. Moreau delivers on his end of the bargain and, after explaining that the Ghost Rider is the twisted incarnation of the Spirit of Justice, Zarathos, after being captured and tortured to madness while in Hell, he exorcises Johnny of the spirit and Johnny becomes human again. The head monk Methodius (Christopher Lambert) proclaims that Danny will never be safe from the influence of evil and says he must die, taking Johnny, Moreau, and Nadya captive in order to execute the boy. Carrigan intervenes, however, killing the monks and taking Danny captive again to deliver to Roarke. The others follow, with Johnny not wanting to desert Danny after having promised to protect him. With the ritual to transfer Roarke's spirit and power into Danny underway, the three infiltrate the compound to save him. Carrigan kills Moreau, but Danny (who Roarke states has the same powers as he does) gives Johnny back the power of the Ghost Rider. Roarke manages to escape with Danny, and the Ghost Rider and Nadya give pursuit. After a vehicular struggle, Ghost Rider manages to defeat Carrigan and causes the SUV carrying Roarke and Danny to crash. The Ghost Rider literally sends Roarke back into hell while Danny, who had died in the accident, is returned to his mother. Channeling the blue flame of Zarathos, Johnny manages to revive Danny and assures him that his safety is assured.
As the film closes, the Rider, now covered in angelic blue flames, rides off on his motorcycle, saying "My name is Johnny Blaze. I'm the Ghost Rider".