- The film opens with a scene of Cao Cao attending Guan Yu's funeral - Guan's decapitated head is buried with a wooden statue in place of his body. The scene then flashbacks to 20 years ago: Guan Yu had been separated from his sworn brother Liu Bei, and he temporarily served Cao Cao while he waited for news of Liu's whereabouts. At the Battle of Baima between Cao Cao and his rival, Yuan Shao, Guan Yu slew Yuan's general Yan Liang and lifted the siege on Baima. As a reward, Cao Cao recommended that the emperor grant Guan Yu the title of "Marquis of Hanshou" and promote him to the rank of a lieutenant general.
Liu Bei's family and his concubine, Qilan, were staying in Cao Cao's territory together with Guan Yu. Cao Cao constantly presented Guan Yu with precious gifts, hoping that the general will be touched and decide to remain by his side, but Guan refused to renounce his loyalty to Liu Bei. When there were news that Liu Bei had sought refuge under Yuan Shao, Guan Yu negotiated with Cao Cao to release Liu Bei's family, and Cao agreed, while Qilan remained behind with Guan. As Cao Cao was aware that Guan Yu was secretly in love with Qilan, he tricked Guan into consuming food spiked with aphrodisiac, in hope that Guan would express his feelings to Qilan and rape her as she was put under paralysis. However, Guan Yu managed to remain rational and did not take his sworn brother's concubine for himself. He and Qilan made preparations to leave Cao Cao after he knew Liu Bei's whereabouts from a messenger sent by Liu Bei himself.
Cao Cao's followers strongly opposed his decision to let Guan Yu leave, as they felt that Guan might become a threat to their lord in future. Despite so, Cao Cao gave a strict order that no one was to stop Guan Yu. However, along the way, Guan Yu encountered resistance and had to fight his way through the passes. Guan Yu slew Kong Xiu, Han Fu, Meng Tan, Bian Xi, Wang Zhi and Qin Qi, consecutively after they attempted to stop him. It was eventually revealed that it was the emperor, and not Cao Cao, who issued the order to kill Guan Yu. Guan Yu agreed to kill Yuan Shao and could not decide whether to stay or leave in favor of their relationship before reuniting with Liu Bei. However, before Qilan left, she pretended that she loved Guan Yu and said that she would ask for Liu Bei's consent so that they can marry in order to stop Guan from helping Cao Cao. Guan Yu refused and was stabbed by Qilan before the emperor sent assassins to kill him. After a final conversation, Guan Yu turned his back on Cao Cao and the emperor. He headed to reunite with Liu Bei, fighting on Liu's side against the rival states of Wei and Wu for the next two decades until his death.
The scene then turns back to Guan Yu's funeral. Cao Cao is sad and sheds tears for the loss of his friend. Before the film ends, Cao Cao makes some final remarks on how not him, but others such as Sun Quan, Liu Bei and Zhuge Liang, are responsible for Guan Yu's death. In a post credits scene, Guan Yu is seen wielding his Green Dragon Crescent Blade upright and stroking his long beard.