Hysteria grips California in the wake of the bombing of Pearl harbour as an assorted group of defenders attempt to make the coast defensible against an imagined Japanese invasion in this big budget, big cast comedy. Members of a Japanese submarine crew scout out the madness.

Rocky Balboa (Stallone) has finally beaten Apollo Creed (Weathers), and feels that he has nothing left to achieve. He plans to retire. Boxing brawler Clubber Lang (Mr. T) becomes the Number 1 Contender, and wants his match with Balboa. Rocky is reluctant at first, but finally agrees to take on Clubber Lang. But things go from bad to worse, where Rocky’s manager Micky (Meredith) unfortunately dies. Rocky must now train with his former opponent, Creed. Rocky now not just fighting for the title, but also for the confidence of everyone and especially of all, for Micky.

After a sexual harassment incident, Dennis Burke (Peter Coyote), a Nathaniel Hawthorne scholar, goes to work at a California college. He begins correspondence with an imprisoned murderer, Lydia Davis (Nastassja Kinski). Burke is finding old habits hard to break, developing relationships with obsessive coeds. Meanwhile, Lydia escapes from prison. Dennis and his colleague Thurston, a computer scientist and hacker, find themselves caught in a web of intrigue.