After successfully saving New York City from the notorious demi-god Gozer, the Ghostbusters—comprising Egon Spengler, Ray Stantz, Peter Venkman, and Winston Zeddemore—find themselves in a precarious situation. They face lawsuits for the extensive property damage incurred during their heroic escapades, which leads to them being barred from investigating any supernatural occurrences and ultimately drives them out of business.

In this new chapter, Ray owns a quirky occult bookstore and takes on the role of an unpopular children’s entertainer alongside Winston. Meanwhile, Egon is working in a laboratory at Columbia University, focusing on groundbreaking experiments related to human emotion, and Peter has turned into the host of a pseudo-psychic television show. Amidst this, Dana Barrett, Peter’s former girlfriend, now has a son named Oscar with her ex-husband and is diligently working as a restorer at the Manhattan Museum of Art.

However, complications arise when an eerie incident occurs: Oscar’s baby carriage is mysteriously controlled by an unseen force, leading it straight toward a busy street. In her desperation, Dana reaches out to the Ghostbusters for assistance. Concurrently, Dana’s colleague, Dr. Janosz Poha, becomes unwittingly enthralled by the spirit of Vigo the Carpathian, a formidable seventeenth-century tyrant and magician who is trapped inside a painting at the gallery. Vigo commands Janosz to find a child he can possess, intending to reclaim his life when the New Year arrives.

Determined to solve the mystery, the Ghostbusters conduct an illegal excavation at First Avenue—the same spot where the baby carriage was last seen moving. Beneath the surface, Ray discovers a flowing river of pink slime that fills an abandoned pneumatic transit line. When he interacts with the slime, it attacks him, leading to an unintended city-wide blackout, and culminates in the Ghostbusters being arrested. To add to their troubles, during their trial, the slime reacts dramatically to the judge’s anger, causing chaos in the courtroom as two ghosts are released. In a bid to clear their names, the Ghostbusters successfully subdue the ghosts, leading to all charges being dropped against them while also allowing them to return to their beloved ghost-hunting business.

As the chaos unfolds, Dana’s apartment is invaded by the slime, endangering her and Oscar. Seeking safety, Dana turns to Peter, and the rekindling of their relationship begins. During their exploration of the slime’s properties, the Ghostbusters learn about how it significantly reacts to human emotions, leading them to suspect that the negative vibes of New Yorkers are fueling its power. In a thrilling sequence, they discover that the river of slime flows directly towards the museum.

Despite expressing their concerns to the mayor, the Ghostbusters are met with skepticism and dismissed. Their predicament worsens as the mayor’s assistant, Jack Hardemeyer, has them sent to a psychiatric hospital to protect the mayor’s re-election campaign. Meanwhile, a spirit resembling Janosz poses a further threat by abducting Oscar from Peter’s apartment, prompting Dana to chase them into the museum alone, where she encounters a formidable barrier made of slime.

As New Year’s Eve approaches, the supernatural activity escalates with the slime flooding onto city streets and wreaking havoc. The Ghostbusters, having been freed from psychiatric confinement, rush to the museum where they face the overwhelming slime barrier, unable to penetrate it with their proton packs. They must rally citizens to summon a symbol of positivity to counter the slime’s influence, utilizing positively-charged mood slime and a lively remix of “Higher and Higher” to animate the Statue of Liberty, steering it through the cheering crowd towards the museum.

Upon reaching the museum, they use the statue’s torch to break through the ceiling, confronting Vigo and Janosz. In a fierce battle, Janosz is subdued, but Vigo tries to transfer himself into Oscar’s body. Just as all seems lost, a chorus of “Auld Lang Syne” from the gathered crowd weakens Vigo, returning him to his painting and liberating the Ghostbusters. With Vigo transformed into a grotesque creature that temporarily possesses Ray, the Ghostbusters counter with a blend of proton streams and positively-charged mood slime.

In a climactic effort, Louis, donned in Ghostbusters gear, joins the fray with his proton stream, working to dismantle the slime barrier. This combined effort leads to the destruction of Vigo, transforming the painting into an image of the Ghostbusters protecting Oscar. Ultimately, the Ghostbusters are met with thunderous applause from the grateful citizens outside, and later, they are honored with the Key to the City from the mayor during a ceremony to restore the Statue of Liberty.