As the player progresses through the main missions, new techniques, armor, and weapons become available for purchase from safe houses established by non-player characters who ally with the main protagonist, but are not considered part of his clan, while additional side missions, represented as wanted posters in the safe houses, are available to play, earning the player a monetary reward upon their completion.

New techniques involve inputting a series of attacks that can significantly damage, stun or launch enemies into the air, and every time one is purchased, the player must go to a training area in the current safe house to practice it.

Red Steel 2 does not continue the story of its predecessor, but adapts the common theme of mixing together ranged and melee combat as well as Eastern and Western culture.

He manages to break free, but Payne, the leader of the Jackals – a vast gang of thugs, murderers and thieves – steals the Hero's katana.

They provide information for the Hero to help him track down Payne, while sabotaging the Jackals' operations in the Upper City, as well as meeting a fight club-operating businessman named Songan.

After the Hero fights his way through the train, which is full of ninjas and Katakara, he finds Shinjiro atop the front car; the "escape attempt" is revealed to be a trap.

After reestablishing communications with Tamiko, Judd, and Jian, the Hero learns that the trio have tracked Shinjiro to the isolated mining community of Rattlesnake Canyon.

The Hero then takes Songan's advice and uses an old locomotive in the town's deserted train depot to travel there and is nearly killed when Shinjiro blows up a bridge up ahead.

The Hero chases Shinjiro through Tiger's Nest and eventually engages in a rematch with Okaji, whom he finally kills by dropping him off a cliff.

When that fails, Shinjiro, now adorned in menacing armor, draws out a newly forged katana for a final showdown with the Hero atop a high cliff.

As Shinjiro perishes, the Hero breaks the sword in two and tosses the hilt end off the cliff in an effort to deter the clans from learning more about this weapon, before looking on to see the sun rise.

The game is also free of graphic violence, like its predecessor, save for occasional unrealistic blood-like splash effects when enemies are slashed or finished off with a stab, before vanishing in a cloud of dust upon defeat.

One example of this was having the Hero wield both a katana and a revolver in tandem, the latter which Vandeberghe felt was an well-contrasting counterpart to the former in a few ways and influenced his decision to make the game set in a Wild West-style world.

[11] He also stated that plans to enhance the challenge mode by adding new enemies and unique objectives were also similarly scrapped due to technical and developmental obstacles.

[27] Chris Kohler of Wired also gave it seven stars out of ten, saying: "I've never played anything quite like Red Steel 2, which lets you use swords and guns simultaneously, switching back and forth between wild swinging and precise aiming".

According to Jason VendenBerghe at his keynote speech at the 2010 European game developers conference, Red Steel 2 has sold approximately 270,000 copies worldwide.

[35] Vandenberghe expressed interest in making the sequel and previously floated the possibility of bringing the Red Steel series to the PlayStation 3 and Xbox 360 when motion-control add-ons for those consoles, the PlayStation Move and Xbox Kinect respectively, were announced during Red Steel 2's development,[36] but ultimately concluded that the current state of the motion control market does not yet justify continuing the series.