Upon returning home from his latest triumph, Rocky (Sylvester Stallone) learns that all of his money has been lost by an unscrupulous financial advisor. To make matters worse, his fight related injuries force his retirement from the ring. So, Rocky, his wife Adrian (Talia Shire) and his son Rocky, Jr. (Sage Stallone) move to their old low-rent neighborhood in South Philadelphia. There, the fighter must resolve the deep-rooted resentment held by his son, a bitterness that grows when Rocky trains Tommy Gunn(Tommy Morrison), a young boxer who soon rises to national prominence. When Tommy turns against his mentor and publicity taunts him, Rocky knows he must fight once more.