After Kurt Hectic, the janitor extraordinaire has bravely ventured into the perilous minecrawlers and averted the alien threat to the Earth, he returns to his friends, the genius scientist Dr. Fluke Hawkins, and his invention, the six-legged robotic dog Max, to celebrate their great victory. However, they find out that one minecrawler in Canada still hasn't been destroyed. Kurt is sent to complete the mission, but as a result, gets kidnapped by an alien being known as Shwang Shwing. Doc and Max rush to his rescue and soon realize that they are up against a much bigger threat, involving an alien empire and galactic conquest. The fate of the Earth is in their hands.

MDK 2 is the sequel to the third-person shooter MDK, largely following the same gameplay template and re-creating its humorous tone. Most of the gadgets used by Kurt in the previous game return in the sequel. In addition to levels in which the player controls Kurt, the game introduces two new playable characters, Doc and Max, with their own levels. The three protagonists have distinctly different gameplay styles. Kurt is a versatile fighter who is able to shoot enemies from afar using his trusty sniper gun; the boss encounters of his levels usually involve various sniping strategies. Kurt can also use his special suit to glide from platform to platform. Max is the most straightforward of the three; having six legs, he can shoot from four guns at once, and also use a jetpack for long jumps. The Doc is physically the weakest character; he relies on stealth and manipulation of items to solve problems. He is able to fight using an atomic toaster, and can also consume plutonium, which transforms him into a monster for a short duration.

The PlayStation 2 version as well as the later Wii version based on the PS2 version introduce different difficulty levels absent in the other versions.