Almost a year following
Jafar's defeat,
Aladdin and
Abu have settled into the Palace of Agrabah with
Princess Jasmine and her father, the
Sultan. Still yearning for adventures, Aladdin foils a criminal group led by the dimwitted
Abis Mal and returns their stolen loot to the citizens of Agrabah. Meanwhile, in the desert,
Iago escapes from Jafar's lamp. Tired of Jafar's abuse, Iago refuses Jafar's demands to free him, and drops the lamp into a well. Iago flies to Agrabah, planning to return to the Palace by befriending Aladdin. During his first interaction with Aladdin and Abu, the three are attacked by Abis Mal and his henchmen, and Iago inadvertently saves Aladdin's life. In gratitude, Aladdin keeps Iago on the palace grounds, promising to speak with the Sultan on Iago's behalf. Abis Mal later finds Jafar's lamp in the well and frees him. Hindered by his incompetent new master, Jafar tricks Abis Mal into wasting his first two wishes, then enlists his help in taking revenge on Aladdin. Abis Mal agrees, also desiring revenge on Aladdin. Meanwhile,
Genie returns to the palace after traveling the world for one year. Since gaining his freedom, he has retained some of his genie magic, but is much less powerful then he was back when he could grant actual wishes. At the evening banquet, the Sultan announces Aladdin as the new Royal
Vizier.
Rajah discovers Iago in the garden and chases him into the banquet. Aladdin asks the Sultan to pardon Iago, but Jasmine is dismayed that Aladdin never confided in her. Genie and Iago help them reconcile, but the Sultan, though remaining suspicious, temporarily pardons Iago and instructs Aladdin to watch over him. However, Jafar infiltrates the palace and forces Iago to trick Aladdin and the Sultan into taking a trip to a waterfall. During the trip, the Sultan finally forgives Aladdin and Iago, but Jafar, having transformed into a gang of
sorcerer horsemen riding
dragon-winged horses, ambushes them, sending Aladdin into the waterfall while taking the Sultan, Jasmine, Genie and Abu as prisoners. Aladdin eventually returns to Agrabah to warn
Razoul but Jafar,
posing as Jasmine, frames Aladdin for murdering the Sultan, and
sentences him to death. Feeling guilty for his actions, Iago frees Genie, who saves Aladdin. Jafar now controls Agrabah, but Aladdin is determined to stop him, and Genie reveals that the only way to kill Jafar and save Agrabah from his control is to destroy his lamp. Iago chooses to leave, but not before Aladdin thanks him for his help. Jafar demands that Abis Mal free him from the lamp with his third wish, just as Aladdin and his friends confront them to obtain the lamp. Jafar, in his Genie form, ambushes the group, knocks Genie unconscious and shatters Carpet. He splits open the Palace gardens, creating a pool of
lava, and traps Aladdin on a sinking rock. Iago, having a change of heart, returns and grabs the lamp but is
burned by Jafar, knocked unconscious and critically injured. With his remaining strength, Iago kicks the lamp into the lava, killing Jafar once and for all. With his death, Jafar's magic is undone, restoring the Palace gardens and Carpet. They mourn Iago but he regains consciousness and is forgiven, being allowed back into the Palace. Aladdin ultimately rejects the Sultan's offer to become his vizier, having decided he wants to see the world with Jasmine instead. In a post-credits scene, Abis Mal realizes that he will never get his third wish. ==Voice cast==