Billionaire Bruce Wayne was forced to retire from his Batman persona. Ten years later, Gotham City is overrun with crime and terrorized by a gang known as the Mutants. The 55-year-old Wayne maintains a friendships with 70-year-old retiring Police Commissioner James Gordon, while the Joker as been catatonic in Arkham Asylum since Wayne's retirement. Arkham inmate and former district attorney Harvey Dent undergoes plastic surgery to repair his disfigured face. Although he is declared sane, he quickly goes into hiding following his release. Dent's disappearance, news stories of the serious of crimes epidemic throughout the city and the memory of his parents' death drive Wayne to become Batman once more. He combats serious crimes, rescuing 13-year-old Carrie Kelly, but now struggles with the physical limitations of age.
Public reaction to Batman's return is divided. Dent's psychologist Bartholomew Wopler blames Batman for creating his own rogue gallery. Dent resurfaces, threatening to blow up a building unless he is paid a ransom. Batman defeats Dent's henchmen, learning that the bombs will explode even if the ransom is paid; Batman realizes Dent intends to kill himself. Batman disables one bomb, and the other detonates harmlessly. He defeats Dent, who reveals that although his face was repaired he still thinks of himself as Two-Face. Kelly dresses as Robin and looks for Batman, who attacks a gathering of mutants in a tank-like Batmobile (incapacitating most of them). The Mutant leader challenges Batman to a duel. He accepts to prove to himself he can win. The Mutant leader (who is in his prime) nearly kills Batman, but Kelly distracts him long enough for Batman to subdue him. The leader and many gang members are arrested. Injured, Batman returns to the Batcave with Kelly; he allows her to be his protégé (despite protest from Alfred).
Batman has Kelly disguise herself as a Mutant, and she lures the gang to the sewer outlet at the West River. At the Gotham City Police Department, the Mutant leader murders the mayor during negotiations. Commissioner Gordon deliberately releases the leader, providing an escape from the building, which leads to the sewer outlet. Before the amassed Mutants, Batman fights the leader in a mud pit; the mud slows the leader, removing his physical advantage, and Batman overpowers him. Seeing their leader defeated, the Mutants divide into smaller groups; one group becomes the "Sons the Batman", a violent vigilante group. Batman's victory becomes public and the city's inhabitants are inspired to stand up against crime. Gordon retires after meeting his anti-Batman successor, Ellen Yindel. In Arkham televised reports about Batman bring the Joker out of his catatonic state.