It has been a long period of peaceful time in the Dragon Realms since Spyro's last adventure. Suddenly, a mysterious dragon named Red is using a group of life-draining stones called the Dark Gems to poison the life of the world.
Aku Aku and Uka Uka want to detrmine which one of them is better. Since they cannot fight each other they instead decide to assemble two teams. Whichever team wins will determine who is better once and for all.