The game takes place six months after the events of Driv3r. It is revealed that both John Tanner and Charles Jericho survived the shootout in Istanbul. In the game's trailer, it is revealed that since then, both men have recovered and Jericho has escaped to San Francisco, while Tanner and his partner; Tobias Jones have pursued him there. Jericho is shown being transported in the back of a prison truck, but manages to escape with help of hired assasin Leila Sharan, who hijacks a KEOC news chopper and fires an RPG at the convoy, and a vial of acid hidden within his mouth by a paid off guard. He overpowers the guards, and hijacks the truck. Tanner and Jones witness this from Tanner's car, pursuing Jericho as he causes havoc on the streets of the city. Tanner ends driving in front of Jericho in an alleyway, who, using the truck rams Tanner's car into the path of a tractor trailer, resulting in a devastating crash, putting him into a coma. The majority of the game takes place in Tanner's coma dream.
Whilst in a coma dream, Tanner soon discovers his ability to "shift" into another person's body, retaining his persona but, to everyone else, looking and sounding exactly the same as the person he has shifted into. Using this confusing power, Tanner helps some teenagers win street races to get money for college fees, aids some vigilante ex-cops remove fake medicine from circulation and lends his driving abilities to police officers hunting down criminals whilst trying to figure out Jericho's plan. After deducing that Jericho is after the materials to create a cyanide gas bomb, he shifts into Ordell, a low-time crook looking to rise up through Jericho's organization.
Unfortunately for Tanner, he discovers that Jericho can also shift, and realises that when he is not in his body, Jericho can take over. He is deconspired, when disguised as Ordell, drives Leila to her target (John Tanner). Eventually, Tanner realises that he is in a dream world when the strange messages from the real world creep into his mind. Jericho's powers become more potent, but as it is in Tanner's head, he is over-powered and defeated when Tanner assumes control of his mental projection of the city. In a mental visualisation of a police interrogation room, Tanner begins questioning his mental projection of Jericho and realises that the news reports from the television in his real-world hospital bed are feeding his coma dream. From this he knows of a real-world bomb plot, but deduces that it is not real - Jericho is a gangster, not a terrorist.
Finally waking up, Tanner requests his car keys from Jones, who reminds him of the truck that hit his Dodge Challenger. Leaving in Jones' Camaro and heading for downtown San Francisco, which is being evacuated due to a bomb threat, a massive cloud of gas erupts. Driving into it, Tanner finds escaping convicts, confirming his theory that it was not a real terror threat. Jericho made a deal with a prisoner for US$30 million to break him out of jail. The 'bomb' was in fact a smokescreen. After a pursuit, Tanner sees Jericho head into the docks. Whilst at first appearing to be a game of chicken and a potential head-on collision, Jones appears in a police SUV and rams Jericho. Tanner claims that he knew what he was doing, but Jones reminds him whose car he was driving before suggesting a well-deserved beer. The fact that Jericho T-boned, just like Tanner at the beginning of the game, and the song 'Eye for an eye" playing in the background, implies that Jericho was put into a coma.
It is also notable that after the credits and other parts, Tanner seems to go back into the coma. This doesn't seem to make sense.(Insert reason here).