SMT 2 follows the story of Hawk, a battler in the Valhalla district of Tokyo Millennium. The citizens of Valhalla compete in a tournament in hopes of gaining citizenship in the Center district, which is out of the reach of demons. Hawk fights in the tournament and wins. He gains citizenship in the Center district and has a personal meeting with the Bishop of the Mesian religion. During the meeting, he is told that he is the Messiah, who will one day save mankind from the bleak world and bring about a paradise called the "Thousand Year Kingdom". Hawk is, then, sent on missions from the Center to eradicate demons and prepare the world for the Thousand Year Kingdom. Yet while he travels across Tokyo Millennium, he witnesses first-hand the atrocities that the Center inflicts on the people.
This game is also known as Digital Devil Story 2 in Japan.