For people who don't believe the events of .Grave Encounters, film student Alex Wright is out to prove them wrong. Alex is as obsessed with the first film as the 20 million people who viewed its viral trailer on YouTube. While he and his friends research the events and visit the real psychiatric hospital depicted in the original film, they find themselves face-to-face with unspeakable evil, banking on the hope that their knowledge of the original film will help them survive the sequel.

Lance Preston and the crew of "Grave Encounters", a ghost-hunting reality television show, are shooting an episode inside the abandoned Collingwood Psychiatric Hospital, where unexplained phenomena has been reported for years. All in the name of good television, they voluntarily lock themselves inside the building for the night and begin a paranormal investigation, capturing everything on camera. They quickly realize that the building is more than just haunted - it is alive - and it has no intention of ever letting them leave. They find themselves lost in a labyrinth maze of endless hallways and corridors, terrorized by the ghosts of the former patients. They soon begin to question their own sanity, slipping deeper and deeper into the depths of madness, ultimately discovering the truth behind the hospital's dark past...and taping what turns out to be their final episode.