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Bollywood movie maker Ram Gopal Varma has challenged the public to see his forthcoming horror film. Ram Gopal Varma said that "I am sure Phoonk 2 is very, very scary and I am sure no one would leave the theatre without getting scared. So we will do a contest under some scientific observation,"

The film tells the story of an evil spirit ruining the peace of a family that has shifted to a new town.

Phoonk ends with the ends of Madhu, the woman who casts a black magic spell on Rajiv's daughter . Phoonk 2 begins with returning of Madhu's ghost from the grave to revenge on the family. A new construction project, Rajiv come with his family to a new place. The terror begins with Raksha and Rohan, they finding a doll in the woods and then it progresses to a series of highly shocking experiences for the full family.