Double Dragon II is a side-scrolling developed and released for the Game Boy and unrelated to Double Dragon II: The Revenge. The player takes control of martial artist Billy Lee, who is being hunted down by an organization called the "Scorpions" for murdering one of its members. The objective of the game is to fight off the members of the Scorpions and confront the true culprit, a rival martial artist named Anderson. A second player can now join in anytime via the use of a Game Link Cable, taking control of Billy's brother, Jimmy.

The combat system is simpler compared to previous Double Dragon games, including the first Game Boy game. The player can perform a series of punches or a kick on most enemies, followed by straight punch or a high kick that knocks the enemy to the floor. Pressing the A and B buttons simultaneously will cause the player to kneel. While kneeling, pressing either button will cause the player to perform an aerial uppercut. Instead of the hair grab from previous games, the player will do a collar grab (similar to Renegade), in which the player can repeatedly punch his opponent in the face or push them to the ground. While standing near a fallen enemy, a jumping knee drop can be performed. Despite the presence of armed enemies, the player cannot disarm them and pick up their weapons like in other games in the series.

The game is composed of three missions, spread across ten stages. The first two missions each consist of four stages that follows a basic structure: the player fight their way through a street until reaching the boss. This is followed by a subway platform, a fight inside a subway car, and the destination platform, where the player confronts another boss. The final mission, composed of only two stages, starts at the streets again, but this time the player must fight his way to the entrance of the Scorpions headquarters. Once inside the building, the player fight their way through a series of floors, including an area where all the previous bosses appear, until reaching the top floor where Anderson awaits. The game has three difficulty settings, but the Easy setting only allows the first mission to be played.