The title depicts a viral outbreak on a luxurious passenger ship, the Starlight. It introduces an underground organization established to put an end to the global operations of Umbrella, the company responsible for the Raccoon City disaster. Leon S. Kennedy, one of the protagonists of Resident Evil 2, joined the initiative and received orders to investigate the ocean liner Starlight, which is rumored to be carrying a new type of Bio Organic Weapon (B.O.W.) developed by Umbrella. Eventually, the headquarters lose contact with Leon and Barry Burton, a supporting character from the original Resident Evil, is sent in to find his whereabouts.
After discovering that the crew and the passengers on the ship have turned into zombies, he crosses the path of an orphan girl named Lucia who, for some reason, can sense the presence of Umbrella's new B.O.W. and also possesses some other mysterious abilities. Lucia is then kidnapped by the monster, but Barry eventually reunites with Leon and they cooperate to put the B.O.W. to flight and save her. The group learns that the monster is supposed to have green blood and, afterwards, witnesses an explosion set the ship on fire. They split up and Leon and Lucia activate the sprinkler system to prevent the engine room from blowing up. Later, the two overhear Barry communicating with Umbrella to arrange some sort of trade-off, their suspicions confirmed upon meeting him again. Barry threatens Leon with his gun, kidnaps Lucia and escapes to an Umbrella submarine with her. Meanwhile, a second explosion hits the Starlight and Leon makes his way to the engine room to investigate its source. He finds out that the B.O.W. destroyed the fuel converter in an attempt to blow up the ship and destroy all evidence. He successfully fights it off but the damage done to the ship is too severe.
The scene then shifts to the submarine where Barry reveals to the captain that he pretended to abduct Lucia to trick Umbrella into evacuating them from the Starlight. He also learns that the company wants Lucia as she is the host of a parasite which grows into another B.O.W. within ten days. Barry forces the surgeons on board to remove the parasite from the girl, but it breaks free from the containment glass and drains the life from the captain, turning him into a zombie. The parasite escapes, killing the whole crew and eventually turns into a mature B.O.W. Barry and Lucia navigate the submarine back and board the near-sunk ship in order to rescue Leon, but they are followed by the grown-up monster. Although they quickly discover what appears to be Leon, the two have to find out that the B.O.W.s are actually shape-shifters and that one of them has assumed the form of their partner. They manage to escape and come across another Leon in the engine room. Together, the three go back to the deck where the B.O.W. pulls Lucia into the sea. Barry rescues her, but then another Lucia appears right next to them. The real girl grabs a knife and cuts her hand to show her red blood, thus confirming her identity. The group defeats the B.O.W. in one last battle and escapes to the submarine. Lucia, having lost her mysterious powers with the parasite's extraction, is offered to live with Barry's family. In the game's final shot, Leon's neck is shown bleeding green blood, revealing him to be the first B.O.W. What happened to the real Leon is not revealed.