In a tumultuous effort, the Sunagakure ninjas attempt to repel an unforeseen invasion of mysterious armored warriors on the Land of Wind. Shortly afterwards, the same armored troops led by Temujin—a skilled knight of impressive power—ambush Naruto Uzumaki, Sakura Haruno, and Shikamaru Nara, who are on a mission to recover a lost ferret. Naruto and Temujin engage in a fierce fight that ends with both of them falling off a cliff.

Taken aback by their friend's sudden misfortune, Sakura and Shikamaru witness yet another alarming development: a massive moving structure appears out of nowhere, ravaging any trees and rocks in its path. While Sakura sets off to find Naruto, Shikamaru infiltrates the imposing fortress in hopes of learning more about the critical situation.

Entangled in a relentless conflict, the Konohagakure ninjas join forces with their Sunagakure counterparts to defeat the common enemy. However, amidst the turmoil, a clash between two different visions of an ideal world emerges.

Naruto Movie 2: Dai Gekitotsu! Maboroshi no Chiteiiseki Dattebayo! is set approximately after the "Sasuke Recovery Mission" arc of the Naruto anime series, which ends with episode 135.

After its theatrical release in Japan on August 6, 2005, Naruto Movie 2: Dai Gekitotsu! Maboroshi no Chiteiiseki Dattebayo! became a direct-to-video film in the United States. It aired on Cartoon Network on July 26, 2008 and was released on DVD on July 29, 2008.

The movie has an animanga adaptation released in Japan on March 3, 2006 and in the United States on November 4, 2008.