At the start of Act 2, you awaken in a cell. The gun that the mysterious woman used was loaded with tranquillizers rather than bullets. She arrives when you wake up, and abruptly asks you to take a purple statue and escape. When you ask who she is, she merely explains that someone is coming and leaves.
Stage 2-1
By and large, the first portion of Act 2 is similar to Act 1, except that gaps will now appear in the floor, and if you fall through any of them, you die instantly. You will have to climb ladders from one section to another.
Start by running to the right. Jump over each of the girders and attack the enemies waiting for you on each of them. As you leap up to attack a knife thrower, a dog should appear from the left and get stuck in the lower portion of the platform. Collect the Spirit Points from the lamps, as well as the Throwing Star that follows. Watch out for the boxer that appears at the end of the first set of girders; you will likely have to squat down to hit him.
After you pass the yellow beam, the next lamp has the Flame technique. Collect it before you have to leap over your first two gaps. You should have no problem clearing them if you have a good running start. Just watch out for the bats that start to appear here. Jump up to the small ledge to get over the second gap, and up to the platform above. The higher lamp after this platform contains a Windmill Star. If you miss it on your way down from the platform, you can climb up the following ladder to claim it.
As you approach the end of this first section, a dog will appear from the left and leap down to attack you. Ignore it and jump to the wall below the ladder. Wall jump back and forth between this wall and the small ledge to the left. You can land on it and jump off to the left to get the red Spirit Points tile before returning to the wall and climbing up the ladder to the next section above.
After climbing up the ladder, leap to the ledge on the left, and then back to the right to continue on. Watch out for the next enemy when jumping on to the following ledge. Also beware of the bat which flies in from the left. Jump down to the platform below, and over to the ladder. Climb the ladder, and bounce over to the ledge on the left in order to reach the platform above the ladder.
The second lamp on this platform contains the Jump and Slash technique. After you collect it and leap to the next platform, a dog will appear from the left as you challenge the enemy to your right. You can use the Jump and Slash technique to get rid of the enemy, followed by the dog.
Clear the gap to reach the floor beyond, and hit the first lamp if you wish to trade in the Jump and Slash technique for Throwing Stars. Then hop up the girders and remove the enemies in your way. Watch out for the bat that appears from the left as you make your way to the end of the girder. You must jump very late off the girder in order to reach the ladder that leads up to the next section.
This is a small section with no enemies. From the ladder, jump left to the floor below, then back to the right above the ladder. Then jump back to the left to reach the platform above the floor, and finally back to the right to reach the ladder up to the next section.
Climbing up the ladder, you will arrive on the right side of this final portion of 2-1, and you must run to the left to reach the exit. As soon as you run left, a dog will leap down from the right as you approach the first enemy. Remove them both, and jump up on to the girder to dispatch two more enemies.
After jumping up to a high platform above a gap in the floor, you must jump down to another girder. Be careful where you land, as an enemy patrols the girder, and a dog will appear from the left as well. When your path is clear, continue on to the left to reach the exit.
Stage 2-2
You're outside now, but the danger only increases from here. After you run to the left and jump up to the column, you will see a new enemy who tosses out daggers. If you stand on the very left edge of the column you can strike the enemy and remove it. Even better, if you have Throwing Stars or Windmill Stars, you can remove it from a safe distance. As you begin to cross the platform it was occupying, a commando will rush you from the right.
The next ledge up contains a machine gunner. Wait for him to stop firing his trio of bullets, and then jump up to strike him down. As you approach the enemy behind him, another commando will appear from the right, so be careful. A third commando will appear from behind you when you drop down to deal with the gunner below. The red Spirit Points tile above the column at the end of the section is easy to miss because it falls through the gap if you're not standing under it. Take the ladder down to the section below.
Climb down, run to the right, drop down and run to the left to start this section off. When the screen begins scrolling, a bat will fly across from the left. Jump on the column and leap to the left. The insect item here holds a health restoring potion that you won't want to miss out on.
The next insect to the left contains the Fire Wheel technique. Once you pick this up, make it your priority to run to the left and leap over the gaps as quickly as you can. If you do this uninterrupted, you can pretty much make it all the way to the end before the effects wear off. Without the Fire Wheel, getting through this section can be fairly difficult due to the placement of the enemies. Let the fire destroy the enemies that attack you, and release Spirit Points from any insects you encounter along the way. Then climb up the ladder for the final section.
Once again, you start this section off on the far right side. Leap from the ladder to the wall on your right, then back over above the ladder. Run to the far right and climb up before jumping back on top of the platform that leads you on to the rest of the stage. Watch out for the bat which attacks you, and jump down to the column below.
After you remove the first enemy, a commando will appear from behind you. Remove him and proceed to the left. If you're quick enough, you can jump up and kill the dagger tosser before he becomes a threat. You'll find a Jump and Slash technique in the insect beyond the dagger tosser. As you proceed, commandos will appear behind you continuously, so be on alert.
When you jump down to the ledge below, collect the red Spirit Points tile from the first insect, but you may not want to collect the Flame technique from the following insect, since Jump and Slash is more effective against the stage boss. Both techniques are particular effective for dealing with the enemies which appear on the progressively higher ledges. The exit is guarded by three basic enemies, but you must land carefully before attacking them, or you risk getting knocked backward and falling through the gap.
Stage 2-3
As soon as you enter the hall, you will be attacked by the enemy known as Bomberhead. Bomberhead moves in a slow menacing pace just like Barbarian did. However, Bomberhead's weapon is a bit more problematic for you. It has better reach, and it spins around, so there's no chance to duck below it. You'll have to be a bit more surgical and precise with your strikes, attempting to slash Bomberhead while he's slowly advancing towards you, before backing away from his attack. If he corners you in the room, you'll have to attempt to leap over him before continuing your assault. If you managed to hang on to the Jump and Slash technique, you'll find that he can be struck down in just two or three hits.
After defeating Bomberhead, Ryu has many questions, and he decides that now would be a good time to pay a visit to his father's old friend, Mr. Smith.