Tenchi Masaki, an ordinary high-school student, unwittingly releases a demon trapped in a forbidden cave. The “demon”, a young woman called Ryoko, tracks Tenchi down to his school, eager to take revenge for her 700 years of imprisonment in the most destructive way possible!

Princess Ayeka from the planet Jurai, seeking her long-lost half-brother Yosho, arrives on Earth. However, when she finds Ryoko, who she believes is responsible for Yosho's disappearance, she imprisons her and Tenchi aboard her ship. Luckily, Ayeka's little sister Sasami helps them to escape, and Ryoko uses her own spacecraft, named Ryo-Ohki, to crash Ayeka's ship and strand the princesses on Earth.

Ryoko finds an egg amongst the wreckage of her ship, Ryo-Ohki, which hatches into a cute furry creature, a replacement spaceship! Ayeka stumbles across Tenchi practising swordplay with his grandfather in the forest, and notices how similar their fighting style is to that used on Jurai. Could it be a clue to the whereabouts of her missing brother?

An incompetent Galaxy Police officer, Mihoshi, is sent to patrol Earth, where the wanted criminal Kagato is headed. Meanwhile, Tenchi and his extended family take a short vacation at a local hot springs, and chaos ensues as Ryoko and Ayeka's fighting destroys the resort and causes Mihoshi's ship to crash, stranding the Galaxy Police officer on Earth.

The murderous space criminal Kagato arrives on earth and seizes Ryoko, claiming to be her creator. Tenchi, Ryoko, Ayeka and Mihoshi chase after him aboard Ryo-Ohki (who has transformed into her spaceship form and combined with the remains of Ayeka's ship, Ryu-Oh).

The girls head for Kagato's ship to avenge Tenchi. Meanwhile, on Earth, Sasami senses Tenchi is in trouble and summons Tsunami, her own Juraian battleship, to save him from near-death. Mihoshi accidentally releases a 20,000-year-old scientific genius, Washu, from Kagato's imprisonment, who turns out to be Ryoko's true creator, and Tenchi returns to face Kagato in a battle to the death.