In the previous issue, Happy Hogan was captured by the Mandarin after donning the Iron Man armor which he did so that no one would suspect Tony Stark of being Iron Man. The Mandarin thinks that he's the real Iron Man, and so attacks him with his rings, which Happy is helpless against. Meanwhile, back in America, Tony Stark rushes to his factory, as he needs to make another set of armor so that he can save Happy. After hours of working, Tony makes another suit of armor which looks the same as the old one, but is much tougher, and enables his heart to withstand more strain. Tony then heads to the Stark Missile development center where he uses a missile to head to China.
By now, the Mandarin has defeated Happy, despite the power of the Iron Man armor and goes down to the dungeon where he has Happy tied up. He starts interrogating Happy, asking him where he keeps the plans for his weapons, but Happy refuses to tell him anything. As punishment, the Mandarin attacks Happy with his rings once more. Luckily, by now Tony has arrived in his set of armor and after taking out some of Mandarin's guards and getting past some electrical traps, he bursts in on Mandarin about to take away Happy to be executed.
At the start of this issue, Iron Man is helping the US Army in Vietnam test some inventions of his designed for military use. After a successful test, Iron Man's told that the real reason he was asked to come was so that he could destroy a fortress known as Hill 38, a laboratory where a communist called Half-Face lives. Apparently, he's designed a new weapon, and so Iron Man is asked to find it and destroy it. Iron Man is taken a certain distance from the fortress, before having to jump out of the helicopter and go the rest of the way on foot. Iron Man is attacked by some Vietnamese soldiers, but easily fights them off.
In his fortress, Half-Face has detected Iron Man's prescence via various machines, and guesses that he's come to destroy his weapon. However, he thinks that it's too late for Iron Man to stop him, as he activates a master dial which starts the cycle which will bring his greatest creation to life. As he powers it up more and more, Iron Man reaches the castle, and destroys some of Half-Face's built in defences. Half-Face is surprised that Iron Man is more powerful than he thought, but knows that Iron Man can't stop his creation. Iron Man then faces a steel door which swings open, containing the creation of Half-Face....