Grandmaster Oogway is fighting with an adversary in the Spirit Realm. The adversary Kai has already conquered the kung fu masters other than Panda in the whole world. He has converted into small charms in the jade format. Oogway gives up when his qi gets stolen but also Warns him about the Dragon Warrior with name Po who has the ability to stop him in his victory journey.
Kai is not a weak worrier and takes it as a challenge for him. He decided to remove the qi of the Dragon Warrior and then comes back to the mortal realm. Master Shifu has grown old and one day he declares his retirement. He wants to be free from his duties of teaching. He is now training the master qi and becomes a teacher for Po. Po soon understands that learning kung fu is not an easy task as he has thought of.