In the Southern Song Dynasty, there is turmoil both externally and internally in the country while infighting and killing among various sects are common in the martial art world. The family Kwok Ching (Leung Ka Yan) and Wong Yung (Au Yeung Pui San) lead a tranquil and peaceful life on Peach Blossom Island. Fate has led CHING to meet Yeung Gor (Andy Lau Tak Wah), son of his old friend Yeung Hong, when he returns to the mainland to look for Yung’s father Wong Yeuk Shi. CHING sympathizes with GOR since he is an orphan, and brings him back to the Island.

GOR is not only naughty but also obstinate. He is finally sent by CHING to learn kung fu at the Chung Yeung Monastery. One day, GOR breaks into the forbidden land accidentally when he is hiding from punishment from his master. Granny Suen comes to his rescue and takes him to an old tomb. There, he meets the owner of the tomb, Dragon Girl (Chan Yuk Lin), and she teaches him the supreme Ancient Tomb kung fu and together they practice the Maiden Sutra, which enables them to read each other’s mind. They fall in love, yet the teacher-and-student love is not accepted in the secular world and they are forced to separate after a series of mishap.

GOR meets Wong Yeuk Shi, the East Infidel, Au Yeung Fung, the West Venom, and Hung Chat Gung, the North Beggar, one after the other and succeeds to learn a lot of unrivalled kung fu from them. Later, he tries his best to look for Dragon Girl and to find out the cause of his father’s death…