InuYasha the Movie 2: The Castle Beyond the Looking Glass

is the second movie of the InuYasha series.

It was released in Japan on December 21, 2002 (between episodes 95 & 96), and in the United States on December 28, 2004. In this film, the character designs are virtually identical to the Rumiko Takahashi versions from the original manga (rather than using the Yoshihito Hishinuma designs from the TV anime).

Story
The story begins with the defeat of Naraku by Inuyasha, Kagome, Miroku and their friends. There is some initial doubt as to whether Naraku is truly dead until it is revealed that the Wind Tunnel in Miroku's right hand is gone and Kagura's heart is in her body again.

Kagome, Sango, and Shippō relax in a hot spring. Akitoki Hōjō shows up, who is quite confused as to how he can get to Mt. Fuji. He notices the three bathing, but is caught by Miroku. Sango then notices Miroku and mistakes that he is peeping on them before she manages to throw a huge boulder on him. Inuyasha hears the noise and comes running, Tessaiga drawn. However, Kagome, who is really afraid that Inuyasha will see her naked yet again, orders him to sit, who promptly falls on the three. As Akitoki crawls away, contemplating his luck, Inuyasha and Kagome are once again in a fierce debate. Soon after this, the group disbands with Inuyasha, Kagome and Shippō pairing off to pursue the remaining shards of the Shikon no Tama, Miroku returning to his master, and Sango returning to her village to search for Kohaku.

Kagome briefly returns to her time period to catch up in school and happens to be learning about the legend of Princess Kaguya. Kaguya was a maiden from the moon, found by a bamboo cutter in the forest. As suitors proposed to her, Kaguya presented to them impossible tasks before returning to the moon. Kagura and Kanna, the two surviving incarnations of Naraku, are somewhat restless now that Naraku is dead. They come across a mirror in a hidden shrine and awaken a maiden who declares herself Kaguya, Princess of the Heavens. In exchange for freeing her, Kaguya promises to give Kagura her true heart's desire; freedom. Kagura and Kanna set out to recover five items that will free Kaguya from her mirror completely.

Kohaku has returned to Sango's village without any memory as to who he is. Miroku's master, Mushin, presents him with a task that is to be given to the surviving descendant who defeats Naraku. Miroku is to destroy a yōkai who threatens to cast the world into eternal night, at which the first sign of the yōkai's appearance for the first time in 50 years is a full moon shining for many nights.

Kagome returns to Inuyasha's time and the two of them, along with Shippō, go to find the remaining shards of the jewel. Inuyasha detects Naraku's presence and runs into Kagura instead. Kagura easily rips the sleeve off of Inuyasha's kimono. She and Kanna are about to take their leave when the moon appears and a poem is said. Kaguya makes her appearance and uses her ability to discern the dark desires of Inuyasha's heart against him. Kagura unleashes her most powerful attack, Dance of the Dragon, and Inuyasha sends it back to her using his Backlash Wave, but is stopped by Kanna who uses her mirror to send the attack back at Inuyasha. Kagome manages to stop Kaguya from inflicting major damage to Inuyasha and the demons leave, with Kaguya noting Kagome has a strange aura about her that does not agree with the flow of time.

Inuyasha and company leave to pursue Kaguya and run into Akitoki Hōjō, the ancestor of Kagome's classmate, who is supposed to dispose a family heirloom (a hagoromo/celestial robe) into Mount Fuji. He joins them, partly because he has a bit of a crush on Kagome and partly because he is being blackmailed by Shippō for an earlier incident. Meanwhile, Kikyō investigates Naraku's death and has come across a slaughtered village where a dying girl gives her the Stone Bowl of Buddha.

Miroku (with his tanuki servant, Hachiemon) journeys to his grandfather's (given the name Miyatsu) grave to find the yōkai he is supposed to destroy. He hears the local legend of the celestial maiden, Kaguya. Miroku's grandfather, who one of the most powerful priests in the series, which is evidenced by the fact that he was able to defeat Kaguya alone, sealed her away into a mirror and was unable to kill her due to her beauty and his own lecherous ways. Kaguya's hagoromo was entrusted to a family that was also given specific {C}instructions for disposing of the robe should Kaguya be freed.

Kagura arrives in Sango's village and attacks Kohaku, taking off with the Swallow's Cowrie Shell that was in Kohaku's possession. After Kikyō surrenders the Stone Bowl of Buddha without a fight to Kagura, she and Kanna free Kaguya from her mirror. Kaguya goes to find her hagoromo and runs into Inuyasha and Kagome.

After pinning Inuyasha to a tree, Kagome fires an arrow to kill Kaguya, but she absorbs it and fires it back at Inuyasha. Kagome, instantly in reaction, jumps in front of the arrow and Akitoki quickly throws the hagoromo/celestial robe in between the arrow and Kagome, but Kagome still gets struck by her own arrow; the arrow impaling into her back. She states her happiness that Inuyasha is alright and even smiles despite being greatly wounded. Inuyasha demands why she had to do that and she tiredly says, "It's no big deal. Besides...you're always saving me, aren't you?" before she collapses to the ground seemingly dead. Inuyasha, thinking Kagome is truly dead, goes frantic screaming her name thrashing and fighting against the vines pinning him to the tree. Kaguya chuckles and Inuyasha furiously and savagely threatens Kaguya for killing Kagome. Kaguya then takes Kagome's body and assures Inuyasha that she "won't let Kagome die so easily," and to follow her if he desires. Inuyasha breaks free from the tree and fuming and boiling in anger and fury, begins to do just so, fiercely determined to rescue Kagome.

Kaguya, whose power has increased exponentially now that she has the hagoromo, prepares to freeze time into eternal night. Inuyasha meets up with Miroku and Sango, Kohaku, Kirara and Shippō, who all had survived the time freeze thanks to Kagome's bandages, which give them immunity (most likely due to how they are from another time). They prepare to rescue Kagome and stop Kaguya. Inuyasha (who is also immune to the time stop due to secretly wearing a locket Kagome had given him earlier in the film that he had initially refused) then reclaims his piece of the robe of the fire rat that Kaguya had stolen.

It is then revealed that Kaguya was in fact a demon who absorbed the real Kaguya and taken on her beauty and power. Kaguya then attempts to turn Inuyasha into a full demon, but his voice wakes Kagome up and she attempts to stop the transformation by hugging him, saying, "I love you as a half demon, Inuyasha!" Because of that, Inuyasha sees Kagome (in his mind) running toward him. As Inuyasha tries to attack her, Kagome desperately says, "I love you! I love you as a half demon!" This stops Inuyasha from attacking. However, it doesn't work completely and hoping to fully awaken Inuyasha's human spirit, Kagome kisses him. Shippō, seeing this, becomes embarrassed and hides. Kaguya orders Inuyasha to kill Kagome. During their embrace, Kagome mentally asks Inuyasha, "Inuyasha, you want to be with me, don't you?" While she thinks this, a tear rolls down her cheek. Her attempt to stop the transformation works and as Inuyasha and Kagome kiss, Kaguya's mirror cracks, returning Inuyasha to his half demon/half human form. Inuyasha, now fully realizing what is going on, returns Kagome's kiss, kissing her back.

When they pull back he pulls Kagome in a hug and they shortly embrace and he tells her that he will remain as a half demon "for a little while longer," but "just for her." But then Naraku reappears from Kohaku's back, revealing that he had purposely faked his death hoping to draw Kaguya out. However, Naraku during this point in the series was still a half demon and thus wasn't able to battle her on equal terms. Miroku notes that if they destroy Kaguya, Naraku would just consume her and become immortal. And if Kaguya destroys them, in either case, Naraku benefits. An exasperated Inuyasha decides that they should just kill both their enemies and charges at Kaguya. However, as Kaguya charges up a deadly spell, Miroku uses the Wind Tunnel to pull Inuyasha out of danger. At the same time, Kagome has Shippō transform into a bow and retrieves Miroku's staff to use as a substitute arrow. As Kaguya readies another spell, Inuyasha uses his Backlash Wave against her. In response, Kaguya uses her mirror to reflect the attack back at against him. Refusing to back down, Inuyasha leaps towards the Backlash Wave and uses the Wind Scar against it. Kagome then shoots Miroku's staff through the attack and shatters the mirror, allowing the Wind Scar to overwhelmed Kaguya's attack and destroy her. Unfortunately, the battle has rendered the castle unstable. The group attempts to flee, but Kaguya shows up again in the form of a black cloud and attempts to possess Kagome in an effort to gain a new body. Naraku reappear, intend on absorbing Kaguya, but Inuyasha stops him with the Wind Scar. Miroku ends his immortal ambitions by uses the Wind Tunnel to absorb Kaguya; fulfilling Miroku's grandfather's wish. Naraku then escapes with Kohaku, Kagura, and Kanna through the broken mirror, followed by the others. Shippō, who is lagging behind in the tunnel, looks back and Kaguya is right behind him. But instead, he wakes up in a field with everyone there now safe from danger, relieving him.

After the credits, Miroku attempts to kiss Sango, causing her to slap him in the face. Miroku tries to excuse his attempt saying that Kagome and Inuyasha have already kissed causing Inuyasha and Kagome to both blush upon hearing this. Inuyasha then begins to stumble out words saying that Kagome "forced" herself on him and in a stumble of further mixed words says that "its not like he wanted to do it," making Kagome mad. But as Inuyasha realizes what he said and tries to fix his wording, Kagome says, "Inuyasha...SIT!" And Inuyasha's face smashes into the ground. And the end screen shows a locket of Inuyasha and Kagome as Shippo says "Inuyasha, grow up, would you?"

In the end Akitoki Hōjō throws Kaguya's hagoromo into a volcano to stop any other beings from ever using its power.

Trivia

 * This marks the first time Akitoki Hōjō has appeared in the series.
 * This is the only movie to have Naraku, as well as Kagura and Kanna.
 * When Hōjō sees Kagome, Sango and Shippō bathing in the spring and narrowly avoids their notice (and their wrath) and also comments on how the girls look like "celestial maidens", but escapes and Miroku is punished instead, it parallels Kaguya's own history, in which she (a celestial maiden) was bathing in a spring (like Sango and Kagome) and is spotted by a passerby, who steals the Celestial Robe from her, which leads to her angrily attacking innocent villagers who happened to be nearby (like Miroku was attacked by Sango). Two other coincidences with this matter are that Hōjō (like the man in Kaguya's past) was in possession of the Celestial Robe and that both situations involved a monk (either Miroku or his grandfather, monk Miyatsu).
 * This movie also marks Inuyasha and Kagome's first kiss.
 * This the only movie in which neither Jaken nor Rin make an appearance.
 * Cherry from Urusei Yatsura can be spotted appearing as a Jizo statue mid-way through the film.

Goofs

 * When Miroku discussed about the dark desires in Kaguya's castle his eyes are yellow not blue.
 * When Sango saw Kohaku escaping through the mirror, his kimono wasn't ripped off from when Naraku emerged from his back.
 * When Kaguya yelled at Inuyasha for abandoning his desire to become a full demon, Kagome's hair (top part) was white, not black.