Plot

In flashbacks, a group of aliens called Zarthans, led by Princess Lauranna, travel to Earth in 1978 and beg the Men in Black (MiB) organization for help in guarding a powerful item called the Light of Zartha before a shape-shifting Kylothian alien called Serleena gets it. The Light of Zartha is a cosmic force so powerful that in the wrong hands it would cause the destruction of Zartha. Due to their neutral status (And knowing the intervention would lead to the destruction of the Earth), the MiB refuse before Agent K seemingly sends the Light off-world in a rocket. An angered Serleena vowed to find the light and promised to destroy any planet that stood in her way.

In 2002, five years after the events of Men in Black, Agent J (Will Smith) is now the top operative for the MIB, the self-funded New York City-based agency that secretly monitors and regulates extraterrestrials' activity on Earth. Jay is largely without a partner, after Agent L (from the first film) decided to return to her former life and subsequent partners have not lived up to Jay's professional standards. J has been developing a reputation for Neuralyzing partners he feels are emotionally unfit to cope with the work. J Neuralyzes Agent T (Patrick Warburton) and throws him out of the MIB after an incident with Jeff, a gigantic worm-like alien living in an abandoned subway.

While investigating a seemingly routine crime at a SoHo pizzeria, Jay uncovers a diabolical plot by Serleena, a shape-shifting Kylothian queen who disguises herself as a lingerie model (Lara Flynn Boyle) but resembles a plant-like hydra in her own form. While investigating the murder of a Zarthan pizzeria owner named Ben (Jack Kehler), J learns Serleena has returned after discovering the Light is still on Earth and recruited a two-headed alien named Scrad and Charlie (Johnny Knoxville) to help her find it. It was Scrad and Charlie who had found the light on Earth and had messaged Serleena to come. They told Serleena that they tracked the light to Ben who ran a pizza parlor in the city. Ben refused to divulge the location of the Light, and Serleena killed him.

Developing an attraction towards a witness named Laura (who witnessed the murder), J breaks MiB protocol and chooses not to Neuralyze her. Laura tells J that Serleena kept asking Ben about the Light of Zartha. J reveals that he is MiB, and that Ben (as well as his killers) were aliens.

Chief Zed tells J that only K knew where he hid the Light of Zartha. The Neuralyzed Agent K (Tommy Lee Jones) has assumed civilian life as Kevin Brown, postmaster of a small town in Massachusetts, and to stop her, Jay must convince Kevin to rejoin MIB, because he is the only operative still alive who knows how to find what Serleena wants, the "Light of Zartha". J demonstrates to K that even inside the post office he is surrounded by aliens.

While Jay tries to Deneuralyze Kevin, Serleena breaks into MIB resulting in a lock down; Jay and Kevin escape after being flushed from the building. Jay then takes Kevin to Jack Jeebs (Tony Shalhoub) an alien pawn shop owner, who built an unofficial Deneuralyzer.

Although Kay eventually regains some of his memory, he still has no recollection of the "Light of Zartha" (he Neuralyzed himself) but left himself a series of clues in case he needed to remember. After locating a locker key at the pizzeria and leaving Laura with a group of alien worms for her safety, the pair head to Grand Central Terminal, where they find a locker containing a society of tiny aliens who worship K as their deity and developed a religion around a video store membership card.

The clues eventually lead to a video-store where they watch a tape that jars Kay's memory: 25 years ago, the Zarthan Queen Lauranna (Linda Kim) arrived on Earth to try to hide the Light of Zartha, but the MIB refused to help due to their neutrality.

Serleena arrived to steal the Light, but Kay activated the Zarthan ship and sent it away. Serleena, believing the Light is on board the ship, chased the ship, but not before fatally shooting Lauranna. Kay then reveals that the ship was a decoy, and that the Light is still hidden on Earth.

Meanwhile, Serleena frees all of the MIB's high-security prisoners and uses them as henchmen. Believing that the Light is in the bracelet worn by Laura Vasquez (Rosario Dawson), a waitress at the pizzeria, Serleena kidnaps Laura and prepares to send her back to her home-world. Kay and Jay assault MIB headquarters, defeat Serleena's henchmen, and rescue Laura.

However, Kay warns them that if the Light is not taken off Earth and returned to Zartha, it will explode and destroy the planet. The pair head back to the worms, only to learn Serleena attacked them and kidnapped her. Joined by the worms, the agents infiltrate and retake MiB headquarters before escaping to return the Light. Serleena chases them throughout New York until J tricks her into being eaten by Jeff.

Guided by Laura's bracelet, the agents soon locate a Zarthan transport ship. When they reach the departure point, Kay reveals that Laura is Lauranna's daughter and the actual Light of Zartha (it's also suggested that he is her father as well). To save Earth and Zartha, Laura reluctantly leaves Earth, much to Jay's dismay, as he had developed feelings for her.

Serleena returns to try to capture Laura again, but Kay and Jay manage to destroy her for good. To cover up the chaos caused by Serleena's rampage, K activates a giant Neuralyzer hidden in the Statue of Liberty's torch. Now that Laura is gone, Kay and Agent Zed (Rip Torn) the head of MIB try to console Jay for his loss, but he answers that he needs no consolation and had accepted her departure without much sorrow.

To provide a measure of comfort, K puts the aliens found in a Grand Central Terminal locker, as one of the clues, in Jay's locker. After Jay suggests, showing them that their world is bigger than a locker, Kay shows him and Frank through a door, that they, are in fact an alien species themselves, kept in a locker in an alien station, suggesting to his rookie worldview.