The story opens with the final scenes from Dracula, showing Dracula’s death at the hands of Dr. Van Helsing (Peter Cushing) accompanied by narration:
"After a reign of hideous terror, spanning more than a century, the King of the Undead was finally traced to his lair high in the Carpathian mountains. Throughout the decades, many had sought to destroy him. All had failed. Here at last was an adversary armed with sufficient knowledge of the ways of the vampire, to bring about the final and absolute destruction. This then was his fate. Thousands had been enslaved by the obscene cult of vampirism. Now, the fountainhead himself perished. Only the memory remained. The memory of the most evil and terrible creature who ever set his seal on civilization."
Using a makeshift crucifix, Van Helsing forces the Count into the destructive rays of the sun. Eventually, Dracula (Christopher Lee) is destroyed and he crumbles to dust in the sunlight. As the wind blows away his ashes, only the Count's ring remains.
Ten years later, 1895, Father Sandor prevents locals staking a woman's corpse through the heart and chastises the presiding priest for perpetuating the fear of vampirism. Sandor visits an inn and warns four English tourists – the Kents – not to visit Karlsbad; however, they ignore his advice.
As night approaches, the Kents find themselves dumped by their fear-stricken coach driver two kilometres from Karlsbad, in view of a castle. A driverless carriage takes them to the castle where they find a dining table set for four people and their bags unpacked in the bedrooms. A servant named Klove explains that his master, the late Count Dracula, ordered that the castle should always be ready to welcome strangers. After dinner the Kents settle in their rooms.
Later that night, Alan investigates a noise and follows Klove to the crypt where he is killed by Klove and his blood is mixed with Dracula's ashes, reviving Dracula. Klove entices Helen to the crypt where she becomes Dracula's first victim.
The next morning Charles and Diana can find no trace of Alan, Helen or Klove. Charles takes Diana to a woodsman’s hut and then he returns to the castle to search for Alan and Helen. Klove tricks Diana into returning to the castle. Charles finds Alan’s dismembered body in a trunk in the crypt. It is now dark and Dracula rises. Diana meets Helen, but Helen has become one of the undead and she attacks Diana. Dracula enters and warns her away from Diana. Charles struggles with Dracula until Diana realises her crucifix is an effective weapon against vampires. Charles improvises a larger cross and drives Dracula away. They escape the castle in a carriage, but lose control on the steep roads. The carriage crashes and Diana is unconscious. Charles carries her for several hours through the woods until they are rescued by Father Sandor, who takes them to his abbey. While waiting for Diana to awaken, Sandor tells Charles about Dracula.
Klove arrives at the monastery in a wagon carrying two coffins bearing Dracula and Helen. Klove is denied admission by the monks. Ludwig, a patient at the abbey, is in thrall to Dracula and invites the vampire inside. Helen convinces Diana to open the window for her, claiming that Dracula is controlling her. Diana does, and Helen bites her arm. Dracula drags Helen off as he wants Diana for himself. Charles bursts into the room and drives the vampires out. Sandor sterilises the bite with the heat from an oil lamp.
Sandor puts silver crucifixes in the two coffins to prevent the vampires returning to them. Helen is captured and staked. Sandor tells Charles that the Helen he knew is dead and that her current form is nothing but a monster now. Ludwig then lures Diana into Dracula’s presence, where she is hypnotised into removing her crucifix. Dracula coerces her to drink his blood from his bare chest, but Charles returns in time to prevent it, forcing Dracula to flee with the unconscious Diana.
Charles and Sandor arm themselves and follow on horseback. A shortcut allows them to get in front of Dracula's wagon and stop it. Charles shoots Klove but the horses gallop off to the castle. Diana is rescued, while Dracula's coffin is thrown onto the icy moat and Charles attempts to stake the vampire but is beaten back. Shots fired by both Diana and Sandor break the ice and the vampire sinks into the freezing waters...
In the final scene, the frozen body of the Prince of Darkness is seen sinking under the forming ice and further and further away into the icy depths...
- In the scene where Dracula is being "resurrected" from a coffin into which his ashes have been spread, from blood dripping down from a poor victim (provided by Klove) Dracula is made to "manifest himself" over a period of about a minute. This was achieved by overlapping "dissolves" of a series of twelve locked-down camera shots, involving first the ashes, then a skeleton, then some body-fat on the skeleton, etc., along with swirling mist, till we finally perceive the full form of Dracula. He doesn't appear fully dressed as is usually the case - the shot moves to outside the coffin and a bare arm reaches out. The vampire's clothes were seen in earlier scenes awaiting his return.