After saying goodbye to the Sub-Mariner, Jim Rhodes and Bethany Cabe, Iron Man flies off en route for home. Along the way, he reflects upon the events that made him into the man he is today.

Flashback
Tony Stark is in a secluded laboratory within the U.S. defense perimeter in Vietnam during the war. He demonstrates his revolutionary new transistor technology to a U.S. general and shows how it can amplify the power of a single magnet to tear down a solid steel door.

Later, Tony accompanies an army platoon through the jungle. He trips on a land mine and the explosion kills every man in the unit and nearly kills Tony as well. A piece of shrapnel embeds itself in his chest where it is lodged dangerously close to his heart. A North Vietnamese warlord named Wong-Chu takes Tony Stark back to his bunker where he makes him an offer: In exchange for having Wong-Chu's surgeons save his life, Tony must agree to develop weapons for the NVA. Tony has little choice in the matter but to comply. Wong-Chu partners him with an elderly scientist named Ho Yinsen.

Tony Stark and Ho Yinsen labor for many weeks, but they do not develop a weapon to be used by the Vietnamese. Instead, they secretly create a rudimentary battlesuit made from scrap metal and various electronics. When Professor Yinsen is alerted to the arrival of Wong-Chu's men, he rushes out into the corridor to create a distraction, enabling Tony enough time to power up the armor. Emerging from the table as the "Iron Man", Tony hears gunfire and knows that Professor Yinsen is dead. He breaks free of the compound and stalks off into the nearby village to confront Wong-Chu.

He finds Wong-Chu entertaining himself by wrestling captured villagers. Iron Man grabs the warlord, hoists him up into the air, and spins him about before slamming him back onto the ground. Wong-Chu's troops open fire on Iron Man, but their bullets are ineffective against Tony's armor. Wong-Chu flees in panic, but Iron Man ignites a nearby ammunitions dump which explodes, seemingly killing Wong-Chu.

Back in the United States, Tony Stark makes several upgrades to the armor and eventually has a heart transplant, eliminating the need for a transistorized chest plate. As the super-hero Iron Man, he becomes a longtime member of the team known as the Avengers.

As Iron Man approaches Long Island, his flight path is monitored by the criminal industrialist Justin Hammer. Hammer is pleased with his past attempts to control Tony's armor, but now he is preparing for the biggest test of all.

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