The game is set after the events of Return of Jafar and before the television series and Aladdin and the King of Thieves. The legendary city of Agrabah is in trouble again: the evil sorceress Nasira (Jodi Benson) is out to avenge the death of her brother, the nefarious sorcerer Jafar (Jonathan Freeman). She begins her vengeful plot by taking over the palace with a spell and kidnapping Princess Jasmine (Linda Larkin) and the Sultan; she then commands the guard's captain Razoul (Jim Cummings) to bring Aladdin (Scott Weinger) to her. The treacherous Nasira believes that if she collects a set of ancient relics that are spread all over Agrabah she might be able to revive Jafar and take over the world, and so she uses her captives to force Aladdin into doing this job for her.
The player assumes control of three total characters in the game: Aladdin, Abu, and Princess Jasmine. Aladdin's abilities range from sword fighting to jumping to stomping. Abu can jump, roll, and climb on walls to a certain degree. Jasmine's character is hiding in a pot for her level therefore the player can hide and hop. The player collects gold coins throughout each level and fights a variety of villains. The game's environments vary greatly and allow much interaction. The game also contains mini games at the end of each level (pie throwing, surfing, skate-boarding, and cloud jumping).