In the game, the player takes the role of a god called from the void (nothingness) to help those who invoked them. However, the player is not an omnipotent style god, but rather a god who rises and falls with his believers and the player must help develop their nature according to their good or evil desires. The player also has a creature, their physical representation in the world, which takes the form of an anthropomorphic ape, lion, wolf, turtle, cow, or tiger. Its physical manifestation can grow to an immense size, and adopt a good or evil persona separate of the player's. They develop their character as the player rewards or punishes their actions. In addition to the god simulation and city-building elements introduced in the original Black & White, Black & White 2 also features elements of real-time strategy gameplay, with the addition of controllable warfare and fighting units.

The player comes upon a scene of a Greek city being devastated by a huge Aztec army after being summoned from a "pure prayer". After the player saves a certain number of people, their people are transported to a new land with a handful of refugee worshipers, the player must re-establish a power base from which to eventually defeat the Aztec empire. To do so, the player must conquer the Norse, the Japanese and the Aztecs, either by peace or war. Throughout the game there is a theme of "The prophecy", which states that a tribe will be destroyed by the mightiest power in the world but will receive a god who will lead them to glory and dominance of the world.