The cheat that punched Crooked Grandma in the face comes back with his friends and a preist. The foreign devil comes to Little Bao's village and smashes Tu Di Gong, the local earth god. Little Bao is devastated by this and starts crying.
Little Bao meets a master who he calls Master Big Belly. After Little Bao learns that Red Lantern Chu is dead, he takes Master Big Belly's sword.Master Big Belly decides Little Bao's time is right and infuses him with mystic vision and then dies. The gods of the opera stand behind him.
A few days before arriving in Peking, Little Bao and the Society of the Righteous and Harmonious Fist encounter a stronghold for Christians trying to escape them. They go in there and destroy the stronghold. All the village boys except Little Bao get killed. Mei Wen and her group of women called the Red Lanterns combine with the Society of Righteous and Harmonious Fist.
The Imperial troops arrive in Peking and shoot Germany's official minister to Peking, Baron von Ketteler, and his army. They do this because the Empress herself admired the society's courageous defence if the common people. She honors them and takes the side of the Society of the Righteous and Harmonious Finand the Red Lanterns.
Little Bao commands the Red Lanterns and the society to burn down the library after he promised Mei-Wen that he wouldn't destroy the books. Mei-Wen finds out and runs inside the building with a christian to save some of the books. They save some of the books, but when they go in the library one more time, the building collapses with them inside it.
After the library burned down and was put out by the secondary devils, the Society of Righteous and Harmonious Fist and the Red Lanterns attack. Little Bao realizes something is wrong before they reach the secondary devils. Behind them a line of soldiers shoot them and kill all of them. Little Bao gets shot and falls to the ground, watching the Gods of the Opera flee before he closes his eyes.