In the first part of 1971 (197X in the Japanese version), the second of a series of underground nuclear tests is conducted, near the Aleutians, sending shockwaves as far as Monster Island in the South Pacific, severely damaging the island paradise and sending Anguirus plummeting into the depths of the Earth, with Godzilla narrowly escaping the fissure into which his friends tumble.

For millions of years, Seatopia, an opulent undersea civilization that resides in vast cities reminiscent of those of Ancient Greece and Rome, has existed in relative peace, ruled by Emperor Antonio, but nuclear tests in recent years have severely affected the cities via the earthquakes the tests produced. With the Seatopian capital badly affected by the most recent test, the Seatopians plan to unleash their civilization's beetle-styled god, Megalon, to destroy the surface world out of vengeance.