The film begins in 1944, Switzerland, taking place after the events of ''Puppet Master III: Toulon's Revenge''. Andre Toulon and his little friends are still on the run, and decide to hide in the Kolewige, an inn 4 miles from the Swiss border. Blade finds the wooden head of an old puppet named Cyclops in their trunk, and when Toulon sees it, he then tells his puppets the adventures with the woman he loves, and his retro puppets, starting in Cairo, Egypt, in 1902.