Guybrush Threepwood travels to Melee Island hoping to become a mighty pirate. In the SCUMM Bar, three important-looking pirates set him three challenges: defeat Carla, the legendary insult sword fighting master, find buried treasure, and steal a statue from the governor’s mansion.

During a failed break-in at the mansion, he meets Governor Elaine Marley and falls in love with her. Elsewhere, the ghost pirate LeChuck, who also desires Elaine, plans to capture her. While Guybrush is still completing the trials, LeChuck and his ghost pirate crew abduct Elaine and take her to Monkey Island.

After learning this, Guybrush buys a ship from Stan, who says it needs a crew of four. He gathers Carla, Meathook, and Otis, then sets sail in pursuit to rescue Elaine.