This sequel to the 2010 film, Alice in Wonderland, opens with Alice Kingsleigh (Mia Wasikowska) sailing the Straits of Malacca with her crew on her father's ship, The Wonder. They are under attack by pirates, so Alice tries to steer the ship away from them. The winds blow the ship toward the ocean, but Alice manages to bring it back up before it hits a huge rock.
Three years later. Alice returns to London and reunites with her mother (Lindsey Duncan). She informs Alice that Hamish Ascot (Leo Bill), the man that Alice rejected in the previous film, has taken over his father's company, as well as Alice's share of it, along with her mother's house. Alice claims this is payback for the rejection, though Hamish denies it (even though it's obvious). He says he will give Alice back the bond to her mother's house if she signs over her father's ship. Alice and her mother argue over the matter, and Alice retreats into another room. There, she sees Absolem (voice of Alan Rickman - his final performance), who is now a blue butterfly. He tells Alice she has been away for too long. Absolem flies toward a mirror and goes through it. Alice follows.
Alice ends up walking through the other side of the mirror where she is now tiny in a huge room, back in Wonderland (or "Underland"). She comes across a large chessboard where the pieces are alive and they frighten her, causing her to accidentally knock over Humpty Dumpty (Wally Wingert). The king's horses and men rush to put him back together.
Alice then proceeds further into Wonderland where she reunites with Mirana The White Queen (Anne Hathaway), Tweedle Dee and Tweedle Dum (voice of Matt Lucas), The White Rabbit (voice of Michael Sheen), The Cheshire Cat (voice of Stephen Fry), Bayard the bloodhound (voice of Timothy Spall), Mallymkun the dormouse (voice of Barbara Windsor), The March Hare (voice of Paul Whitehouse), and the Bandersnatch. They're all in the middle of (what else) a tea party, when they inform Alice that Tarrant Hightopp/The Mad Hatter (Johnny Depp) has not been himself lately, and they believe Alice will be able to help him.
Alice runs to the Hatter's home. He is elated to see her again, and he explains that he recently came across a small blue feather top hat that he made as a child. It has him perplexed because it would mean his family is still alive, having believed them to have perished on Horunvendush Day when the Jabberwocky attacked. The Hatter believes Alice can help bring them back, but she claims it is impossible (despite her feelings toward that word). Displeased, the Hatter turns dark and says this is not the Alice he knew.
Mirana tells Alice that if she wants to save the Hatter's family, she must speak to Time (Sacha Baron Cohen) and use the Chronosphere, a powerful device that travels through time that only Alice can use since she is not originally part of Wonderland. She guides Alice to Time's castle, which is located inside a grandfather clock. Alice sneaks into the castle and sees Time go into a room full of pocketwatches. Time pulls off the watch of one man, saying his time is up. Time spots Alice, who asks him to help her save her friend's family, but Time says the past cannot be changed.
Moments later, Iracebeth The Red Queen (Helena Bonham Carter), arrives, as she is Time's sort-of girlfriend. He gives her a gift of a man getting his head chopped off. She tosses it to the side. Alice sees this as a chance to steal the Chronosphere. Time and Iracebeth witness Alice getting away.
The Chronosphere activates, and it works like a ship. Alice takes it through an ocean of time and tries to find Horunvendush Day to prevent the Hatter's family from dying. She is momentarily frightened by the Jabberwocky's appearance breathing fire, so she ends up arriving much earlier on the day of what was supposed to be Iracebeth's coronation. The Hatter is there with his whole family. Iracebeth is ready to be crowned, but the crown won't fit on her swollen head. The crown breaks, and the Hatter leads everyone in a big laugh, infuriating Iracebeth. After she throws a fit, her father (Richard Armitage) declares that she is unfit to rule the kingdom, so he names Mirana as the new queen. Iracebeth storms off tearfully and swears vengeance against the Hightopp family. The Hatter's father Zanik (Rhys Ifans) chastises his son for his behavior, making it sound like he is disappointed in his son.
Time, who has been going after Alice, ends up in the same period and comes across the Hatter and his friends during a tea party. Time asks for Alice, but the Hatter keeps him waiting for her by saying he invited her to the tea party. The Hatter and his friends then start making a bunch of corny time-based puns. Time eventually gets sick of it and leaves, putting everyone stuck in one minute before Tea Time.
Alice goes to try and speak to Mirana and her parents, inadvertently learning about another incident from long ago that led to Iracebeth's behavior. Alice uses the Chronosphere to travel to this time in the hopes that she can prevent Horunvendush Day from happening at all. This brings Alice to the childhood of the sisters and most of her other friends. Alice meets the young Tarrant (Louis Ashborne Serkis), who brings Alice to his home. He introduces her to his father and says he wants to make Alice a hat. Tarrant shows his father the blue feather hat from earlier, which Zanik takes and accidentally rips. Zanik throws it away, and Tarrant runs away crying. What he never knew was that Zanik recovered the hat and kept it.
Alice then finds the sisters as children. Their mother (Hattie Morahan) was making tarts, and the young Iracebeth (Leilah de Meza) had been eating most of them. After their mother sent them away, Mirana (Amelia Crouch) snuck one off and dropped some crumbs, which she kicked under Iracebeth's bed. When their mother found out, she spotted the crumbs by the bed and questioned Iracebeth. She told her sister to tell the truth, but Mirana says she didn't eat them. Iracebeth ran into the street, and almost ran into a grandfather clock. Alice sees this and tries to stop her, but Iracebeth is distracted by Alice pushing the clock away, causing the girl to slip and hit her head on a fountain, resulting in her head swelling up. Alice then realizes what Time meant by saying the past cannot be changed.
Time catches up to Alice and shows her what damage she has done to him by taking the Chronosphere. He warns her that she has put Wonderland in danger. Alice then escapes into a mirror that takes her back to her world.
Alice wakes up in a mental hospital with her mother. Dr. Bennett (Andrew Scott) diagnoses her with 'female hysteria'. He attempts to sedate her forcefully, but Alice manages to get the needle away from him and stick him with it. Alice's mother and the orderlies see her trying to escape, and her mother tells her to run. Alice makes it to another magic mirror and runs through it with the Chronosphere.
Alice arrives on Horunvendush Day as the Jabberwocky is attacking. She spots the Hightopps running for it, but they are apprehended by Iracebeth's guards, proving that they are indeed alive in the present.
Alice returns to the present and runs to the Hatter's home, only to find all their friends gathered in his room, weeping. The Hatter is in his bed, just inches away from death, pale and colorless. Alice goes to him and says she finally believes him and says she is sorry. The Hatter opens his eyes, and he hugs Alice. She tells him that Iracebeth is keeping them prisoner, and the color in his hair returns as he decides to spring into action.
Alice, the Hatter, and all their friends ride to Iracebeth's castle. The Hightopps are nowhere to be found, leaving the Hatter in despair once again. Suddenly, he and Alice spot Iracebeth's ant farm, which has a top hat forming in it. The Hightopps are in there, shrunken to a tiny size, but the Hatter is happy to see them again. Iracebeth and Time find them too, but she turns on Time and steals the Chronosphere for herself and brings Mirana with her. The now weakened Time tells Alice to stop Iracebeth before time is no more. Alice has Time taken back to his castle while she goes after Iracebeth.
Iracebeth takes Mirana to the night where she lied about the tart so that she can tell the truth. When the same event happens, Iracebeth kicks the door open and screams, causing her younger self to see her and making time begin to freeze in Wonderland. Alice manages to get the Chronosphere back and race to the present. She rushes through Time's castle as everyone starts to freeze up. Alice reaches the room of the Chronosphere and nearly makes it before she gets frozen too. Somehow, a spark from the Chronosphere makes it out and pulls itself toward its holding place, restoring everything to order.
Iracebeth still thinks nobody loves her, but Mirana says she does, and she apologizes for lying. The two of them reconcile. They then give the Hatter the "eat me" cake to give to the Hightopps so they may grow back to normal size. The Hatter tells his father that he makes hats, and Zanik says he always believed in his son. Alice must then say goodbye to the Hatter and her friends once again as the mirror reappears, and she must go home.
In the real world, Alice's mother is ready to sign over the ship until Alice shows up. She says it's okay if she sells the ship if her mother can keep her house. Her mother then tears up Hamish's contract in his face, leaving him humiliated in front of his family yet again.
The film concludes with Alice and her mother going into business and preparing to sail the world together.