A new criminal has begun operating in the steamy shroud that covers Steam City. The city police cannot keep up with him- he claims that his megamaton has teleport abilities, and it seems to be true. Whenever the cops get close, the machine vanishes in a mysterious fog.

Enter the Narutaki Detective Agency. Child sleuth Narutaki hits the set, and quickly gets a hunch regarding the "teleporting" mecha. While the police chase shadows, Narutaki finds the real villain, and the battle is on. After Narutaki's megamaton, Goriki, defeats the enemy machine, the criminal reveals himself- he is Knight Phantom. He speaks of his hatred for Narutaki, and vows to destroy everything he loves. But Narutaki doesn't seem to know who this stranger is.

The Machine Baron- The Ultimate Collector. He desires unique and antique machines, old robots, vacuum cleaners, watches; anything of witch there is only one in the world.

The villain crashes an antique machine show, but is handily defeated by Narutaki and Goriki. He vows his vengeance, and in order to learn Goriki's weaknesses, disguises himself as a reporter, wanting a story on Narutaki. As time passes, the Machine Baron's desire to destroy Goriki turns into a desire to possess the machine. Unable to bring himself to destroy Goriki when he has the chance, the Machine Baron must finally admit the truth- he has fallen in love with Goriki!

There's a festival approaching to celebrate the dragon guardians of Steam City, but to everyone's surprise, a real dragon shows up and begins breaking into the local jewelry stores. At least, it seems to be a real dragon. The shop owners are living in a state of perpetual terror, and it seems that only Narutaki will be able to crack the case.