Bully 2 takes place 15 years after it's predecessor and focuses on a new chracter named Greg Johnson who moves to Bullworth to enter it's local university college.
The standard setting of Bully 2 is the same Bullworth from before but turned into a larger country town including more designated areas and atrractions. Instead of Bullworth Academy, the school setting takes place in Bullworth University, a college that has formed since the last events. The academy has been demolished since the first game with regular high schools and private schools replacing it.
Much of Bullworth has changed with new areas to explore and the interaction of side missions and jobs around the town. New stores that have been added include a Mall, comic book shop, arcade, movie theater and more additions as well.
Gregory "Greg" Johnson is a 19 year old student who attends the newly formed Bullworth University, where he makes friends with his roommate Adam Stanton along with preppies Suka Kasen and Colton McNeill. After doing various favors for them and self-proclaimed "party king" Pat McKenna, Greg gets revenge on a former bully named Stanley Burke.
During the events though, a war begins between the Jocks, Nerds and Preppies caused by Adam and Greg. Principal Dickens threatens to expel both of them but they decide to stop the fighting in the school by helping the new "social program" known as the Bright Sun. Greg begins aiding the main leader, Mr. Henries, into convincing the others to join in by force and blackmail, soon toppling the elite social factions such as the Baseball Team, Prep Collage and Jock fraternity. The Bright Sun proves to be more dangerous though as the popularity system begins to revolve around being a member, discriminating those who do not join.
Greg starts to investigate the Bright Sun and discovers that Mr. Henries is actually Gary Smith, the villain from the first game, who has come back to take over the school by influencing the club. Greg attempts to reveal the information but is betrayed by a brainwashed Colton who destroys the evidence. With help from Suka, Adam and the now unpopular Pat McKenna, the team recover a 30 year old Jimmy Hopkins who has since become a police chief and moved to a neighboring town. Greg and Hopkins crack down on the Bright Sun but Smith disappears with no evidence. Just as the police leave though, a riot begins in the university as the students begin to overthrow the adults and town populace lead by Colton and Smith.
With help from former popular students, the Bright Sun are defeated along with Colton. Greg then confronts an armored Gary Smith who wields a flamethrower. After using a rubber bullet rifle, Greg blows up Smith's suit while Hopkins arrests him. The school thanks Greg for his help and he is joined by his family as the summer begins.