The sequel starts several months after the first movie. Kenai has now become a cave bear and lives with his foster brother, Koda. They have just awoken from hibernation and all the bears are off to Crowberry Ridge to pick the first berries of the season. Kenai has a few dreams about his childhood friend, Nita. Nita was the daughter of the elder of another tribe, and Kenai gave Nita a special amulet as a child.
The bears are on their way to Crowberry Ridge when they bump into Nita. Nita was about to marry Atka, a man from another tribe who she didn't really love. However, the spirits do not allow Nita to marry Atka as she already has a bond with Kenai. They told her to go to Hokani Falls with him and burn the amulet Kenai gave her so many years ago. Nita therefore must turn into a bear.
At first Kenai refuses, but eventually agrees. Nita misses her friendship with Kenai, but doesn't ask him that. What she asks him instead is whether he misses being human, to which he says he has thought about it. The two are overheard by Koda who is upset and slightly angry and races up a mountain and then eventually is found by Nita.
When they make it to Hokani Falls, they burn the amulet, and Nita, who can no longer understand animals, says goodbye. Koda asks his mother in spirit-land to turn Kenai back into a bear because Koda believes that way, he'll be happy. Koda goes to the village to find Nita, and Kenai pursues him after he is told where Koda went by Rutt and Tuke. Koda is unable to go to the village as the villagers would try to kill him in fear.
Kenai gets to the village where he gets in a fight with Atka, Nita's husband-to-be. He falls off a cliff into shallowwater, where the spirits come. Koda tells Kenai that he asked his mother in spirit-land to turn Kenai back into a Human. However Kenai tells Nita that he doesn't want turn back into human because he doesn't want to leave Koda. Nita says that she would turn in a bear to be with both of them. So Nita is turned into a bear with the same colouring as Kenai. The film ends with Kenai and Nita getting married, Rutt and Tuke getting mates, and the spirits changing the image that Nita and Kenai drew on a cave wall of them playing as infants, into a picture of them playing as bear cubs.