Batman: Arkham City takes place after the events of Arkham Asylum, where The Joker has been captured, but the situation in Gotham City is still filled with chaos. This time, the terrorists and criminals of Gotham return in a new form.

The story begins with Dr. Hugo Strange, who has been appointed as the warden of Arkham City, a walled-off district in Gotham that serves as a prison for criminals and villains from Arkham Asylum, as well as criminals from across the city. This area becomes a dangerous land where the battle between criminals and the destitute takes place.

Batman is captured and imprisoned in Arkham City after being framed by Hugo Strange. However, he manages to escape and seeks to uncover Strange’s sinister plan involving Project Titan and the secrets that put everything in jeopardy.

As Batman tries to uncover the truth about Strange's plan, he must face off against some of the most dangerous criminals from his world, such as The Joker, Two-Face, Penguin, Riddler, Catwoman, and Ra’s al Ghul. Each of these characters has their own agenda and goal to either control Arkham City or destroy Gotham City.