Hot Potato begins in Chang Lan, a fictional country somewhere in east Asia. The villain Carter Rangoon (Sam Hiona) orchestrated the kidnapping of a U.S. senator's daughter a Ms. June Dunbar (Judith Brown). Rangoon's demands were to see aid to Chang Lan or Ms. Dunbar would be executed. The U.S. was in a difficult situation. They were not welcome in that area of the world and had little influence in the region. They sent in whom the general (Ron Prince) described as their best man, Black Belt Jones (Jim Kelly).
Jones assembled a small force of mercenaries to assist in the task at hand. Johnny Chicago (Geoffrey Binney), whose primary motivation in life was money, was the first the mercenaries introduced in the film. The duo of Jones and Chicago were joined by Pamala (Irene Tsu), a Chang Lan operative who was to act as the group's interpreter and guide. She quickly proved her usefulness as a skilled fighter as she took on several goons refusing assistance from Jones and Chicago. Finally the group joins up with Rhino (George Memmoli) at a brothel. Rhino is a grotesque Italian from Texas with a passion for women and food.
Rangoon's scheme was more diabolical than kidnapping and extortion. He also arranged for a prostitute named Leslie (also played by Judith Brown) to pose as the senator's daughter for the rescue party to free her. Leslie was concerned for her safety if she were discovered. So, to insure her safety she stole some letters from Rangoon's office. If the material in the letters were to get out it could spell the end of Rangoon.
Jones and his team invade Rangoon's jungle fortress, symbolic of Hannibal on the backs of elephants.
After the rescue Rangoon discovers his letters are missing and dispatches his minions to follow them through the jungle.
As the group make their way through the jungle they engage several groups of henchmen, all of whom fail. The plot begins to thicken as well. Romantic involvement begins to form as Chicago falls in love with Leslie. The group is also joined by a native woman and her son whom Rhino won in a wrestling match.
Jones becomes suspicious of the impostor and at the opportune moment went looking in the purse she seemed to cherish more than life itself. He found the letters. The group attacked and Leslie was taken. Jones proposed a trade: the letters for the girl. Things did not go as planned and Leslie was killed.
Jones then plans a covert attack on Rangoon's primary estate ending in a one-on-one fight scene between Rangoon and Jones as the senator's daughter hung over a pit of tigers.
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