A few years before the events of the first film, retired parapsychologist, Elise Rainier (Lin Shaye), reluctantly uses her spiritual ability to contact the spirit of Quinn Brenner's (Stefanie Scott) mother, Lillith, who died a year before. However, she urges Quinn not to make contact with her mother again after she senses that the spirit is not Lillith. Quinn begins to see a mysterious figure waving at her from a distance, and following her unsuccessful attempt to win an audition for a prestigious drama school, she is hit by a car and spends several months in a coma before waking up with her leg cast. The accident leaves Quinn stuck in her apartment with her father, Sean (Dermot Mulroney), and younger brother, Alex (Tate Berney). The demonic figure continues to haunt her, becoming increasingly malevolent as time progresses and leaving Quinn with her neck injured after the demon flings her around her bedroom. Sean tries to convince Elise, who like him is still grieving after the loss of her significant other: her husband, Jack, to help his daughter, but Elise declines, stating that her previous visits to the "dark" spiritual world made her realize that an evil spirit is hunting to kill her. However, she is convinced by her fellow parapsychologist, Carl (Steve Coulter), to continue using her spiritual ability, reminding her about her successful case involving Josh Lambert and stating that she is stronger than any spirits or demons because she is living and they are not.
Due to Elise's refusal, Alex suggests to call a ghost hunters duo: Specs (Leigh Whannell) and Tucker (Angus Sampson), but Quinn's possession grows increasingly worse as she, now possessed by the demon, breaks through her braces. Realizing that they are a fraud, Sean prepares to kick the duo out until Elise arrives timely. Deducing that the demon's goal is to lure potential victims to "the Further" so it can eat their life force, Elise decides to enter the spiritual world with Specs and Tucker recording any activities and words she spells out. With the help of a spirit who likewise is a victim of the demon, Elise enters the Further and after a brief encounter with the evil spirit that haunts her, the Bride in Black (Tom Fitzpatrick), meets with Jack (Adrian Sparks), whom she realizes is the demon (Michael Reid MacKay). While managing to defeat the demon, Elise returns to the material world after realizing that Quinn has to defeat the faceless version of herself by herself, who is slowly taking control of her features and soul. Though Quinn is at first at a disadvantage, Elise reads a message that the Brenner's late neighbor had tried to tell Quinn of: that Lillith is leaving her with a letter to read before she graduated. Lillith's (Ele Keats) spirit then appears to help Quinn fully take control of her body and return to the material world. She then disappears after leaving parting words to her family.
Following the Brenner' successful case, Elise decides to come out of retirement and work with Specs and Tucker. She arrives home and notices a figure watching her from outside. Thinking that it is Jack at first, Elise realizes that it is something demonic as the demon from the first film (Joseph Bishara) suddenly appears beside her.