The film was produced by Tsui Hark, was co-directed by Ching Siu-tung and Raymond Lee and starred Brigitte Lin, Joey Wong and Yu Rongguang.

[1] Following Dongfang Bubai's apparent death in Swordsman II, the jianghu (martial artists' community) disintegrates into chaos as it lacks a dominant figure to serve as a de facto leader.

The Ming imperial court sends a naval admiral, Gu Changfeng, to assist the Spanish in searching for the remains of a Dutch warship sunk near Black Woods Cliff, the site of Dongfang Bubai's death in Swordsman II.

At Black Woods Cliff, Gu Changfeng discovers that Dongfang Bubai is still alive in disguise as an elderly woman, and manages to convince him to return to the jianghu.

Consumed by his desire for power, Dongfang Bubai decides to continue his ambitious plan to unite the jianghu under his rule and dominate China.