Chu Liuxiang is having drinks with his friend, Monk Wuhua. Gong Nanyan of the Holy Water Palace suddenly appears and accuses Chu of having stolen the palace's Heaven's One Holy Water and committed a series of murders. She agrees to give Chu a month's time to clear his name, or else the mistress of the palace will kill him. Chu's curiosity and eagerness to prove his innocence spur him to investigate the case.

Following "Clans Of Intrigue"'s success, director Chu Yuan, novelist Ku Lung, and superstar Ti Lung re-teamed for another adventure featuring sexy knight Chu Liu-Hsiang. This time, he travels to the mysterious Island Of The Bats, where he encounters treacherous monks, beautiful women, and a strange Prince. The movie is also a significant milestone in the amount of female flesh revealed on screen, proving that Shaw movies can balance the yin of cheesecake with the yang of beefcake.

Chu Liu-hsiang, the charming, capable, and, yes, sentimental, swordsman is back in action for this extremely well-named third in the hit box-office series. The titanic team of director Chu Yuan and novelist Ku Lung wisely choose to give their hero a whole new, non-stop, cliffhanger-fraught adventure featuring a mystery swordsman, a sensual swordswoman, an imperial assassin, a Ghost Mansion, the Bat Island, a booby-trapped tunnel, double crosses, and secret missions. And there are no fewer than three martial arts choreographers on hand to guide the amazing mayhem.