In the rural countryside, a bespectacled Taoist priest called Four-eyed Taoist is always at odds with his neighbour, a Buddhist monk called Master Yat-yau. Their respective students, Kar-lok and Ching-ching, are friendly towards each other. The Taoist and Buddhist play pranks on each other.
One day, a convoy of soldiers escorting a coffin passes by their houses. Inside the convoy is Four-eyed's junior, Taoist Crane, and Crane's four disciples, as well as a young prince and his bodyguards. Four-eyed and Yat-yau learn from Crane that there is a vampire in the coffin, and the convoy is on its way to the capital to let the emperor inspect the corpse.
During a thunderstorm that night, rainwater washes away the magical charms on the coffin and the vampire breaks out, becoming more powerful after being struck by a bolt of lightning. The vampire starts attacking everyone in the convoy and infecting them with the "vampire virus", causing them to transform into vampires as well after a short time. Taoist Crane remains behind to hold off the vampire while the prince and his attendant flee towards the houses.
At this critical moment, Four-eyed and Yat-yau both decide to put aside their differences and focus on destroying the vampires.