In 2027, a year after the end of the Fourth Non-Nuclear War, Newport City still bore the scars of conflict. A bombing incident involving self-propelled mines and the shooting death of a military officer suspected of bribery in arms deals unfolded. In the rain-soaked city, Aramaki Daisuke of Public Security exhumed the cyberbrain of the fallen officer.

Motoko Kusanagi gained independence from the 501st Organization, securing freedom within the military. Despite rejecting Aramaki's invitation from Public Security Section 9, who had supported her independence, she considered forming her own unit. Amidst this, an unknown entity hacked the Logicoma.

When Major Motoko Kusanagi is having a rendezvous with her lover Jose, a cyberprosthetic technician, she receives an urgent report from her comrade Batou about a bomb terrorist attack in a building in Nishinouchi. Rushing to the scene and suppressing the terrorists, it is discovered that their memories have been falsified by an ultra-wizard-class hacker rumored to be the Fire Starter.

In the winter of 2028, as Newport City shows signs of post-war recovery, Major Motoko Kusanagi, leading her independent assault unit, oversees a protest against the water price agreement controlled by foreign cartels. Suddenly, the riot police open fire indiscriminately, triggered by an unprecedented simultaneous ghost hack via the cyber virus "Fire Starter."