The Shadow Master appears for the first time and orders Jimmy to retrieve his twin brother and the Dragon Sword. Jimmy kidnaps Billy, but fails to retrieve his sword. The Shadow Master then attempts to get rid of both the brothers, but the brothers escape and Jimmy changes sides, joining Billy. Billy and Jimmy become the Double Dragons and face off against the Shadow Master at the EMF plant.

Kami, the master of the Komodo Dojo, recruits a Junior Dragon named Michael and uses him to attack the Shadow Dojo and take revenge on the Shadow Master. However, when Michael is captured, Kami must put aside her desire for vengeance by teaming up with the Dragons to free Michael.

An archeologist named Dr. Linquist takes the Lee brothers to an ancient underground Dragon Dojo where they discover powerful Dragon artifacts known as the Dragon Claws. Dr. Linquist also discovers an ancient being known as the Shadow Khan, who is trapped in a shield prison. When Khan grants the Shadow Master a new weapon and powerful new armor, the Double Dragons must use the Dragon Claws to stop him. Read full episode synopsis.

Under threat from the Shadow Master, the Shadow Khan rebuilds the Shadow Dojo and begins terrorizing Metro City with illusions representing people's worst fears. The Double Dragons must retrieve the Dragon Claws and stop the Shadow Khan with help from Dr. Linquist and his son

Countdown betrays the Shadow Master after being chastised for bumbling a mission. With help from Countdown, the Shadow Khan hypnotizes Daj and causes him to throw the Dragon Claws in the Black Flame, freeing Khan from his prison. After dominating the Shadow Master and taking control of his Shadow Warriors, Khan launches an attack on the Dragon Dojo.

The Shadow Khan begins terrorizing Undertown with his group of Terror Warriors. Meanwhile, Billy and Jimmy discover a large egg hidden in an ancient underground temple. The egg hatches, revealing a real-life dragon that quickly bonds with Daj. Daj and his new pet help the Dragon Masters fend off Khan and his minions.