A small group of vampires investigate an ancient tomb in the Syrian Desert, which they believe belongs to Dracula, the first vampire. To keep Blade from interfering, they frame him for the murder of a human familiar. FBI agents subsequently locate Blade's hideout and kill his mentor and friend, Abraham Whistler. Demoralized, Blade surrenders and is arrested.
The vampires' familiars have arranged for the authorities to turn Blade over to them. He is rescued by Hannibal King and Abigail Whistler, Abraham's daughter, who invite Blade to join their band of vampire hunters, the Nightstalkers. From them, Blade learns that Danica Talos, an old enemy of King's, has revived Dracula, or "Drake", with the goal of using his powers to cure vampires of their weaknesses. As the first of the vampires, Drake's DNA is untainted and he is able to survive in sunlight. Along with newly-innovative ultraviolet "Sun dog" ammunition, the Nightstalkers have created an experimental bioweapon known as Daystar, capable of killing vampires at the genetic level. However, they need a purer blood source to make it effective. As Drake is too powerful to kill via normal means, they hope that the virus will kill him and, with his blood in the mix, ensure the rest of the species is wiped out, but also fear that this will include Blade.
Eager to test Blade, Drake isolates him from the Nightstalkers, as he considers them unworthy of challenging him. He explains his view that all humans and vampires are inferior in his eyes and that he intends to wipe them from the Earth. Abigail finds evidence of the vampires' "Final solution": a network of 'farms' where comatose humans are drained of their blood for vampire consumption. Told the humans are all brain dead, Blade deactivates the farm's life support systems.
Returning to the Nightstalkers' hideout, Abigail and Blade find all of them dead except for King and Sommerfield's daughter Zoe, both of whom have been taken captive. A recording left by Sommerfield, Daystar's creator, reveals that Drake's blood is all that is needed to make it complete and effective. King is tortured by the vampires for information, but refuses to talk, even when they threaten to turn him and feed him Zoe's blood.
Blade and Abigail arrive and free the captives. Drake eventually bests Blade in single combat and prepares to kill him with his own sword. Abigail fires the Daystar arrow, but Drake catches it before it strikes him. He drops it to the floor by Blade, not realizing the danger it poses to him. Abigail shoots Drake with another arrow, this time wounding him. Blade uses the distraction to stab Drake with the Daystar arrow, triggering a chemical reaction that completes the "Daystar" virus, releasing it into the air, the virus becomes airborne, killing Danica and the rest of the vampires. As Drake slowly succumbs to his wounds and the virus, he praises Blade for fighting honorably, but warns him that he will eventually succumb to his need for blood, thus proving that Blade already is the new type of vampire.
Using the last of his power, Drake disguises himself as Blade. The FBI recover the body and declare Blade legally dead (In the unrated cut, as the FBI tries to do an autopsy on "Blade", Drake springs back to life, killing several of the autopsy members before ominously looming over one of the orderlies). Hannibal narrates that the virus did not kill Blade as the human half of his heart did not stop beating, it only slowed down, causing him to enter into a comatose state until his body was ready to fight again. Blade awakens several months later ready to continue his war on all vampire-kind.
