In 2002, five years after the first Men in Black, Agent J (Will Smith) is now the top operative for the MIB, the New York City-based agency that secretly monitors and regulates extraterrestrials' activity on Earth. J has no permanent partner since agent K resigned, and Agent L (from the first film) returned to work in a morgue. Subsequent partners have not lived up to J's standards.
While investigating a crime at a SoHo pizzeria, J uncovers a plot by Serleena (Lara Flynn Boyle), the shapeshifting Kylothian Queen. After destroying several planets, she sneaks onto Earth, and disguises herself as a lingerie model. In her own form, she resembles a plant-like hydra. The memory-wiped "neuralyzed" Agent K (Tommy Lee Jones) has resumed civilian life as Kevin Brown, postmaster in Truro, Massachusetts. Unbeknownst to him, the post office workers are aliens, so K feels right at home. To stop Serleena, J must convince Kevin to rejoin MIB. K is the only living operative who knows how to find the Light of Zartha. The planets that Serleena destroyed were where she looked unsuccessfully for the Light.
While J prepares to deneuralyze Kevin, Serleena takes over MIB HQ, which locks down. J and Kevin escape by literally being flushed from the building. J takes Kevin to Jack Jeebs (Tony Shalhoub), who owns a jerryrigged deneuralyzer. Although K eventually starts to regain some memories, he cannot recall the "Light of Zartha". K is neuralyzed, but left a series of clues in case he needed to remember. They first stop at a video store, where they watch a tape that jars K's memory. In a fictionalized version of the truth, 25 years ago, the Zarthan Queen Laurana arrived on Earth to hide the Light of Zartha. Wanting to remain neutral, the MIB refused to help. Serleena arrived to steal the Light, but K activated the Zarthan ship and sent it away. Believing the Light was aboard, she chased the ship - after fatally shooting Laurana. K reveals that the ship was a decoy; the Light remains hidden on Earth.
Meanwhile, Serleena frees MIB's worst high-security prisoners and recruits them as her henchmen. Believing the Light is in the bracelet worn by pizzeria waitress Laura Vasquez (Rosario Dawson), Serleena kidnaps her and prepares to send Laura back to Kyloth. K and J, helped by the "worm guys", assault MIB headquarters, defeating Serleena's henchmen and rescuing Laura. However, K warns them that if the Light is not sent to Zartha, it will explode and destroy the planet. They fly to building-top departure point in J's car. Serleena chases after them but is eaten by Jeff, a giant alien worm living in the New York subway system. At the departure point, K reveals that Laura is Laurana's daughter, and is the actual Light of Zartha herself. To save Earth and Zartha, Laura leaves Earth. She and J are both reluctant, since they have fallen for each other. Serleena, having assimilated Jeff, returns to capture Laura again. K and J are finally able to destroy her and Laura escapes to her homeworld Zartha.
To cover up the events caused by Serleena's rampage, K activates a giant neuralyzer hidden in the Statue of Liberty's torch. K and Chief Zed (Rip Torn), the head of MIB, try to console J for the loss of his love, but he claims no sorrow. For comfort, K puts the tiny city of aliens from a Grand Central Terminal locker (one of the clues) into J's locker. When J suggests showing the miniatures their world is bigger than a locker, K shows J that they themselves are in a locker of a huge alien station.
- Tommy Lee Jones as Kevin Brown/Agent K
- Will Smith as James Darrell Edwards III/Agent J
- Rip Torn as Chief Zed
- Lara Flynn Boyle as Serleena
- Johnny Knoxville as Scrad & Charlie: Scrad has second head named Charlie
- Rosario Dawson as Laura Vasquez
- Tony Shalhoub as Jack Jeebs
- Patrick Warburton as Agent T
- Jack Kehler as Ben
- David Cross as Newton
- Colombe Jacobsen as Hailey
- John Alexander as Jarra
- Michael Jackson as Agent M (cameo)
- Peter Graves as Himself