Master Liu and Master Law are rival masters of Shaolin style kung fu and Wu-Tang style sword fighting, running schools in the same city. Their top students, Chao Fung-wu and Hung Jun-kit, are actually close friends, with Jun-kit's sister, Yan-ling, having a crush on Fung-wu. After observing the two students fighting at a brothel, two of the local Qing Lord's soldiers report the power of the styles to him. The Lord determines that the two styles are dangerous and that he must learn both. After being poisoned by the Lord, Master Law lets Fung-wu stab him. For this Fung-wu is being sent to prison. Trying to rescue Fung-wu, Jun-kit teaches a prisoner the Shaolin Chin kang fist, not knowing the prisoner is the Lords spy. After their escape from prison, the four of them are ambushed. To overcome the Lords men Fung-wu teaches the spy some Wu-tang sword techniques. As they are still being overpowered Fung-wu and Yan-ling have to flee the scene just to be captured by the Wu-Tang who came to prosecute Fung-wu for killing Master Law. As they leave for Wu-Tang temple Yan-ling gets shot and dies in Fung-wu arms. The Wu-Tang leave the dead body behind. Jun-kit finds it, believing the Wu-Tang killed his sister. Hoping to avenge Yan-lings death Jun-kit returns to the Shaolin temple for training as a monk. Meanwhile Fung-wu is being held at the Wu-tang temple. The Qing Lord has since learned both the styles from the spy; but, because he did not learn either from a master, his grasp on both styles is imperfect. To overcome this deficiency, he decides to have the Wu-Tang and the Shaolin destroy each other, so he may be the only master of both styles. To do this, he stages a martial arts contest between the two temples, hoping to appeal to the traditional rivalry between the Shaolin and the Wu-Tang. Jun-kit, and Fung-wu, are selected by their respective temples as the representatives. During the contest the Qing Lord, in his impatience to see both Wu-Tang and Shaolin destroyed, admits his true motives, and his role in Yan-ling and Master Law's deaths. Tat-chi and Ming-kai must then combine Shaolin Chin kang fist and Wu-Tang Sword style to defeat him.