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This film takes place 10 years after Micheals first killing spree in 1978. Having been in a coma for 10 years after being blown up in the hospital, Micheal awakes to hear ambulance driver talking about his young niece.
Meanwhile, back in haddonfield, home of Micheals nine year old Jamie Lloyd, who is the daughter of Laurie strode, who went into hiding with her husband and young son john to escape the memories of her past. Young Jamie is unaware of her roots, although she has nightmares about him, and is being bullied at school as the boogyman is her 'uncle'.
Jamie is living with her foster mother and step sister Rachel, who decides to take Jamie shopping to buy a halloween costume. In the store, Jamie picks out a costume very similar to the one Micheal was wearing the night he stabbed his sister in 1963, at the same time, we see micheals hand reach out to take an all-to-familiar mask from the shop window.
Dr. Loomis finally makes it to Haddonfield by hitchhiking. He goes directly to the police station looking for Sherif Brackett only to learn that he had retired and moved to Florida. Instead he talks to the new sheriff Ben Meeker. Loomis tells him that Michael Myers is back to kill his niece and anybody else who gets in his way. Loomis convinces Meeker to put a curfew on and they try calling the state police, but the phone lines where damaged in the explosion at the truck stop.
A group of Hillbillies upset about the curfew ask the sherif why. Loomis tells them about Myers and they form a lynch mob.
While Trick-or-treating Rachel loses Jamie in a group of kids. Michael causes a power failure by throwing Bucky into a transformer. Jamie finally finds Rachel, and Meeker and Loomis find the girls. Meeker takes the girls back to his house and radios Deputy Logan to come from the Corruthers house where he had been waiting for the girls to come home. Unknown to Logan, Michael had snuck into his car.
When Meeker, Loomis, and the girls get to the house they come across Meeker's daughter having sex with Rachel's boyfriend. They secure the house, not knowing that Michael was already in the house, and arm the men with riffles. Rachel uses Meeker's short wave radio to call the state police, while Meeker and Loomis go out looking for Michael.
Rachel brings Jamie up stairs to rest. While Sherif Meeker's daughter Kelly brings coffee to Deputy Logan and finds him dead, Myers kills her. Brad, Rachel's boyfriend sees this and tries to shoot Michael, but misses and dies by Myers' hands.
Rachel and Jamie escape to the attic and then on to the roof only to be followed my Michael. Jamie climbs down to the ground and Rachel gets thrown off the roof by Michael. Jamie thinks she is dead and takes off towards the school where Michael stalks her until Rachel knocks him out with a fire extinguisher.
Loomis, Meeker, and the hillbillies show up. The hillbillies take Rachel and Jamie to the state police barracks. In the confusion Michael climbs under the hillbillies truck. On their way to the barracks Michael climbs up on the truck and kills all the hillbillies. Rachel takes control of the truck and runs down Michael. When the state police arrive Jamie walks over to her uncle and holds his hand, just then Michael raises his knife to stab Jamie. Then all the police blast Michael Myers into a whole and blow him up with dynamite.
Later that night Jamie's adopted mothers is starting her a bath, and Jamie stabs her with a pair of scissors.
The movie ends with Jamie holding the bloody knife, with the same blank look on her face that Michael had in 1963.
