Shrek (Myers) has rescued Princess Fiona (Diaz), got married, and now is time to meet the parents. Shrek, Fiona and Donkey (Murphy) set off to Far, Far Away to meet Fiona's mother (Andrews) and father (Cleese). But not everyone is happy. Shrek and the King find it hard to get along, and there's tension in the marriage. It's not just the family who are unhappy. Prince Charming (Everett) returns from a failed attempt at rescuing Fiona, and works alongside his mother, the Fairy Godmother (Saunders), to try and find a way to get Shrek away from Fiona.
The film picks up right where the first movie ended... Shrek and Fiona return from their honeymoon to find a letter from Fiona's parents inviting the newlyweds over for dinner. The only problem is that they have no idea that their daughter is now an ogre.
Right after their honeymoon the newly wed couple goes to Princess Fiona's parents for dinner. When a Fairy God Mother discovers Fiona and Shrek are married she reminds the king about a deal they agreed on years ago that Fiona should have married Prince Charming (her son). The king then hires a cat named Puss-in-Boots (a sword fighting cat and ogre slayer) to kill Shrek.