Armed terrorists have taken over the Chinese Embassy in New Port City. Holding an unknown number of hostages, the group, calling themselves the Individual Eleven, are demanding that the government cease accepting Asian refugees and dissolve the five Asian refugee camps situated throughout Japan. The members of Section 9 have mobilized and are in position to move in. However, due to the events of the Laughing Man Incident (1st GIG), Section 9 technically no longer exists. The unit must wait for an official order from Chief Aramaki, who is busy making his case in front of the new Prime Minister of Japan.

Post Traumatic Stress Disorder is put on full display. A Japanese National named Gino, who suffered through the horrors of Non-Nuclear World War IV, the Second Vietnam War, now passes his days as a helicopter pilot for the chairman of a media conglomerate. His cushy job, however, does not take away the sheer internal pain that Gino is facing. As he moves through his isolated existence, Gino leaps between reality and fantasy. However, he keeps his dementia solely to himself. Having no one to help him, his condition continues to worsen.

A cat thief named Cash Eye has infiltrated a building owned by Federation of Economic Organizations Chairman Tsutomu Tadokoro. The cat burglar made quick work of the top-notch security system and left a calling card on the Chairman's desk saying that Cash Eye will be infiltrating his vault during an upcoming party. Albeit reluctant to get Section 9 involved, Aramaki has no choice but to assist Tadokoro. Prime Minister Kayabuki has requested that his unit go undercover in order to prevent the burglary.

A joint training exercise between the Japanese Ground and Maritime Self-Defense Armies that takes place within the sealed sector of New Port City's Refugee District goes awry, putting the Asian refugees in danger. Section 9 Chief Aramaki takes the matter up with Kubota, his friend at the Ministry of Defense. While there, Aramaki is approached by a man from the Cabinet Intelligence Service: Kazunoto Gouda. Acting as a representative for his superior, the Chief Cabinet Secretary, Gōda requests that Aramaki bring the full force of Section 9 to bear on the situation. There's just one catch...

During a visit to the Dejima Refugee Residential District off the coast of Nagasaki, Prime Minister Kayabuki receives a bouquet of flowers that is accompanied by an envelope stamped with the diamond seal seen in "NATURAL ENEMY". The envelope contains a letter that promises an attempt to take the Prime Minister's life. At a meeting of the Prime Minister's Cabinet, Aramaki is shown the letter and told that so far the stamp on the envelope has turned up in eight other terrorist incidents. The Cabinet calls for Section 9's assistance. However, much to the unit members' chagrin, Section 9 will not be deployed in an offensive role.

A highway accident involving a large commercial truck has left a fully prostheticized man dead, his body torn apart from the impact. Togusa is summoned by Aramaki to delve deeper into the matter as the dead man had recently tried to blackmail the Energy Ministry. The dead man's name was Kanji Kotan and he had recently arrived to Niihama by way of Tōkyō. Due to the rest of Section 9 guarding the Prime Minister ("INDUCTANCE"), Aramaki can only send Togusa, with a Tachikoma as protection, to dig up what he can about the man's recent activities before he died.

A botched arms deal reveals that the government's plans to remove Plutonium from the Shinjuku dig site ("EXCAVATION") by sea have been compromised. Section 9 is called in to take the Plutonium out of Old Tōkyō by land. The members of Section 9 are not happy being used by the government. Batou is especially incensed since Section 9 is supposed to be an offensive organization. His patience will be further tried when he and Section 9 find out who will be accompanying them on their mission...

While Ishikawa begins to dig deeper into the background of CIS Representative Kazunoto Gouda, the rest of Section 9 are instructed to arrest one Shou Kawashima, a Taiwanese vegetarian restaurant chef who has been seen at three locations where the Individual Eleven have claimed responsibility for attacking. The Taiwanese restaurant where he works is near the Nanyou Shimbun (Newspaper) building that had received an earlier threat against it by the Individual Eleven. Section 9 moves into position around the Taiwanese restaurant and commences their stakeout.

Several bombings have occurred throughout New Port City. Each time, Section 9 arrives too late to stop their detonations. With a fifth and final bomb set to go off somewhere in the city, the unit puts all of the information they have found from the first four bombings together. Even the Cabinet Intelligence Service is having their fair share of difficulties. A hacker has infiltrated its incredibly advanced computer security system. The hacker enters the vast array of information stored at the CIS and begins to collect data...

Togusa aids a woman who has been chased by a man through the streets of Niihama. With his Mateba, Togusa is able to disable the man's prosthetic body. However, he does not secure the man's pistol. When Togusa helps the woman up, the man has enough movement left in his body to aim his gun and fire at the woman, killing her instantly. The murderer is brought to trial. However, due to the events that occurred immediately following the murder, Togusa is brutally cross-examined by the murderer's lawyer.

Training has commenced to find new recruits for Section 9. With Motoko acting as the target, Batou and Togusa watch as the recruits try to keep up with the Major. After ditching some of the recruits, Motoko has to lose just one more pair. She ascends some stairs in an alley and the recruits follow her. Moving out into the street above, the recruits see that they have lost the target. However, Batou and Togusa have lost contact with the Major as well.

Section 9 has uncovered Shō Kawashima's ("FAKE FOOD") external memory device on the net. Hidden in a route to the Asian matrix only accessible through the European array, Section 9 concludes that the device was hidden by Gouda. Unfortunately, Gouda has left no trace of his movements in the device. The Major prepares to dive into the device with Bōma and Ishikawa watching her closely. However, before she can dive, Aramaki notifies her that someone even more important than the external memory device has just surfaced...

With the latest Individual 11 incident still fresh in the public's mind, Section 9 discovers that only a skilled face sculptor could have created Kuze's prosthetic face. Since only two artists fit that description, they quickly locate the craftsmen and go to question them.

While on an assignment guarding the Prime Minister, Saitou and the Tachikomas pass the time playing poker with a few policemen who are also assigned to the case. Much to the chagrin of the other men, Saitou wins hand after hand. The Tachikomas take notice of Saitou's uncanny accuracy and start to comment. Their constant chattering quickly gets on the other player's nerves, so to smooth things over Saitou recounts his time working as a sniper for mercenaries in Mexico.

During a scheduled maintenance, the Tachikomas begin to chat away about the Individual Eleven. While talking in their new "forum", Batou and Togusa appear and take one of the Tachikomas - who just happens to be Batou's pet - with them to Spring-8 to look at the scientific evidence gathered on the Individual Eleven.

Ishikawa returns from the Peninsula with the latest intel on Kuze, but is surprised to learn of a possible refugee uprising. The Major and Aramaki are sent to see the Prime Minister to discuss this matter and the existence of "hub cyberbrains". While they wait, the rest of the team listens to Ishikawa's report on Kuze's past.

Following a tip, the Major conducts an undercover investigation of Kuze in Taiwan. While there, she saves a boy running from the Mafia. After being saved, the boy follows her, making sure that she finishes what she started. The mafia will continue to pursue the boy and the Major has to protect him.

The Major and Batou are flown to Berlin in an effort to track down a terrorist called "Angel's Feathers". While there, Batou attracts the attention of a young girl in a wheelchair. The girl is waiting for the yearly visit from her father, but Batou's appearance piqued her curiosity. As the days lead up to her father's visit, her curiosity in this stranger grows stronger.

Despite close scrutiny by the authorities, the Dejima refugees declare their independence. Kuze is suspected to be the mastermind behind this new resistance and Section 9 is sent to detain him. The Major hacks into the refugee cyberbrain hub and easily locates Kuze. When the team rushes to capture him, however, they find themselves in the middle of a trap.

Section 9 heads to Etorofu in search of Kuze. During their investigations, the Major finds an interesting floppy disk on the body of a dead addict. The floppy proves to be a goldmine of information, as it contains records of plutonium transactions. The last buyer to purchase the material was a group of Asian refugees. Realizing the transaction is about to take place, the team rushes to the location and is surprised by what they find.

Much to the chagrin of Batou, Motoko, and the rest of the team, Kuze and the refugees manage to escape in one of the camouflaged boats. They are further hampered when an explosion causes heavy losses, leaving them unable to follow the fleeing boat. Regrouping, the team decides to refocus the investigation to the events surrounding Kuze. They start a secret investigation into Sagawa Electronics, the company responsible for the nuclear material transaction, and find that Gouda was involved. Meanwhile, as the boat heads for Dejima, Kuze makes his own unsettling discovery.

The city of Fukuoka is evacuated when a live nuclear bomb is found. With the Dejima Refugees targeted as the prime suspects, the government sends the Self-Defense Forces into the city. Aramaki suspects the CIS's involvement in this latest incident is deeper then it appears. Batou is sent to gather more information from Gouda, but will he be able to hold his temper against the arrogant agent?

The Chief Cabinet Secretary uses the excuse of the refugees possessing 10kg of plutonium to mobilize the military against Dejima. With the available evidence against the refugees, Prime Minister Kayabuki reluctantly agrees. However, she soon learns from the Chief Cabinet Secretary that he's aligned himself with Imperial America and is now after her job. Knowing her days as P.M. are numbered, she agrees with Aramaki's plan and calls the U.N. in for a nuclear inspection of Dejima. The move buys them some time to defuse the situation, and Section 9 heads to Dejima to meet up with the U.N in two days. However, with tensions running high it is only a matter of time before someone fires the first shot.

With the felling of Dejima Bridge by the refugees, a rumor circulates around the Cabinet that the refugees plan a mass suicide bombing using nuclear bombs. Fearing this, the Cabinet steps up the attack against the city. Meanwhile, Prime Minister Kayabuki has been secretly arrested and taken to an unknown location. Aramaki, Togusa and Proto, in trying to help the P.M. are also taken into custody and secured in her office. With Section 9 having entered the non-communication zone and Aramaki being cut off from communication, Ishikawa and a Tachikoma make their way to Spring-8 on their own. Meanwhile, Gouda has sent an unwitting Section 4 after Section 9 to retrieve the plutonium.

As the attack on Dejima escalates, the Major catches up with Kuze. She explains the whole situation to him and he agrees to follow her. They are about to leave when both are attacked by the Self-Defense forces and in the confusion are trapped under the rubble. Togusa rescues the Prime Minister and brings her back to her office. There, Aramaki hopes her influence will stop the launching of the ultimate weapon. Meanwhile, Batou reasons with Section 4.

Kuze and the Major come up with a plan to save the refugees, but the chances of its success are slim. Realizing this, the Tachikomas disobey the Major's orders and come up with a plan of their own. Batou has also disobeyed the Major's orders to go to the bridge and is desperately searching for her in the ruins of Dejima. Meanwhile, the Prime Minister is frustrated with being spurned by the Chief Cabinet Secretary. Determined to be remembered as more than a mere figurehead, she takes matters into her own hands.