Film debut of Thomas Ian Griffith, who portrays a Vietnam veteran; in real life, Griffith was only 13 years old when the Vietnam War ended. At the time this movie was made, Thomas was also four months younger than Ralph Macchio who played a teenager.
Ralph Macchio's character was supposed to have a romantic relationship with the character of Jessica (played by Robyn Lively) but he asked to have their relationship be platonic because he didn't want his wife to be jealous.
While filming, Sean Kanan performed his own stunts, including one wherein he lunged forward and landed on his stomach for 20 takes. After taking aspirin for four days to deal with the residual pain, Kanan fell unconscious. At a hospital, he was diagnosed with internal bleeding caused by a torn abdominal wall.
The only one of the original team not to return for this second sequel was cinematographer James Crabe who was severely ill with AIDS at the time of production. His role was taken over by Steve Yaconelli. Crabe succumbed to his illness a month before the film was released.
After answering an open casting call for The Karate Kid Part III, Sean Kanan was called back for a screen test with Ralph Macchio. "I wanted them to remember me," said Kanan. "So I backed Macchio into a corner and wouldn't let up."
Jonathan Avildsen, son of the film's director John G. Avildsen, screen tested for the part of Mike Barnes. He did such a fine job that the role of "Snake" Silver, Terry's son, was created especially for him.
This movie was part of a wave in the late '80s/early '90s to introduce widescreen letterbox movies to the general public. The first printing of the VHS are all in letterbox; re-prints from 1994 claim to be in wide screen but are pan & scan. (Ghostbusters II (1989) was another big title movie released in letterbox only in the first printing, many video stores got complaints about these titles because customer's thought that there was half of the picture missing, many video store owners called RCA/Columbia to find out if there was a printing problem to only be told that they were meant to be this way.)
In the original script Daniel's mother was never mentioned or seen in the movie. It was Ralph Macchio's idea they have a scene of Daniel having a telephone conversation with his mother explaining her absence that Daniel's mother went to New Jersey to take care of a sick uncle.
The house where Terry lives is actually the Ennis House, a home designed by Frank Lloyd Wright in 1924. The house has been used in multiple films, but most notably as the original "House on Haunted Hill (1959)," but also in Blade Runner (1982) and Grand Canyon (1991).
Mr. Miyagi plant store was an old building in Highland Park, Ca. Also Daniel girlfriend pottery shop was across the street from it . You can look up where Mr. Miyagis building used to be at on google maps 128 N ave 50, 90042. You can still see the train tracks where the bullies busted doughnuts in the mustang, after destroying Mr. Miyagis store.
In the second half of the movie, Daniel is wearing an MA-1 military flight jacket inside out. It's not really an error since these jackets are designed with a bright orange lining so that a downed pilot could wear it inside out to be spotted by rescuers. However, it was a strange choice for the costumer to have the character wearing a jacket so unconventionally. Perhaps the jacket appeared a bit too paramilitary in its proper form, but inside out it looked more like an outdoor, wilderness jacket.
Mike Barnes' final dialogue (wherein he triumphantly jeers Daniel into getting up for the "Sudden Death" portion of their grand championship match) was not in the screenplay, but rather ad-libbed by Sean Kanan.
In the scene where Miyagi says, "Hope confusion end soon, Daniel-san. Miyagi heart empty without you," he is looking at a picture of himself and Daniel in their costumes from the final scene of the previous Karate Kid movie.
Thomas Ian Griffith's character, Terry Silver usually called Daniel "Danny Boy", which is coincidentally the name of a popular Irish song. Griffith played another character named Terry and sang "Danny Boy" in Excessive Force (1993).
The trivia items below may give away important plot points.
The final All-Valley Tournament results can be seen at the beginning of the tournament. "Sladkus" lost to "Dempsey" in the semifinals, while Barnes defeated "Orshan" in the same round. Barnes then defeated "Dempsey" to become a Finalist. As Defending Champion Larusso fights Barnes. Since he wins, Larusso is named Grand Champion.