The player character is the new franchiser of the re-branded Fazbear Entertainment Inc., with headquarters in Washington County, Utah. After investing in the restaurant, the player is left with $100 to spend on their new venue. After the first night, they are encouraged to prepare for their "ultimate test", which is a big party on Saturday. Under the guidance of "Tutorial Unit", the restaurant's artificial intelligence, the player invests in various props, animatronics, and sponsors to add to and fund the restaurant.

In addition to running the restaurant, the player, under obligations of "Paragraph 4", must also check maintenance at the end of each day with four possessed and dilapidated animatronics: Scrap Baby, which is Circus Baby rebuilt from scraps after being ejected from Ennard following the events of the previous game; Molten Freddy, the remains of Ennard with Funtime Freddy as its primary head; Lefty, a mysterious black bear animatronic; and Springtrap (nicknamed "Scraptrap"), the worn-out Spring Bonnie costume which contains the undead body of serial killer and Fazbear co-founder William Afton, who survived the destruction of Fazbear's Fright. The player can either complete the maintenance under the guidance of the mysterious "Cassette Man" before salvaging the animatronics, or throw them back outside, unless they have already snuck in the pizzeria through a previously purchased discounted object. The player is left to survive each night as the salvaged animatronics attempt to kill them.