The game starts in Washington, D.C., where President Ronnie (based on the U.S. President Ronald Reagan) has been abducted by the evil Dragon Ninja. The game's intro begins with the following introduction: "Rampant ninja related crimes these days ... Whitehouse is not the exception". A Secret Service agent speaks to the titular "Bad Dudes", two street-smart brawlers named Blade and Striker: "President Ronnie has been kidnapped by the ninjas. Are you a bad enough dude to rescue Ronnie?" The Bad Dudes pursue the Dragon Ninja through the New York City streets, onto a moving big rig truck, through a large storm sewer, through a forest, onto a freight train on an old Southern Pacific line (where the titular character of another Data East arcade game, Chelnov, can be seen being transported in a frozen container in the arcade version), through a cave, and into an underground factory in order to save President Ronnie.
The Japanese and English language versions' endings of the game differ. In the English version, after the Bad Dudes defeat the Dragon Ninja, they celebrate by eating hamburgers with President Ronnie. At the very end, President Ronnie is seen holding a burger while standing between the Bad Dudes. Behind them are many security guards, with the White House in the background. In the Japanese version, President Ronnie gives the Bad Dudes a statue of them, as a reward. The Bad Dudes are seen leaning against a fence on a sidewalk next to their statue. Unlike the ending of the international version, the Japanese version's ending shows a list of nearly every enemy in the game with their names (except the unnamed green ninja boss that multiplies himself), while some faces appear next to the names of the game's staff. The background music played in both versions' endings is also completely different.
