The rivalry between the Yakuza and the Colombian Cartel is ongoing feud starting from the production of the Cartel-created drug SPANK: The sale of Spank attracted the Yardies attention, allying themselves with the Cartel, interrupting Kenji Kasen's interest in the city. He sends Claude to ruin the meeting between the the Cartel and the Yardies at the Hospital parking lot in Rockford. All goes bad, the two have formed an alliance and now the Yardies are pushing the drug on the street of Staunton Island. Angered by this action, Kenji sends Claude to kill the Yardie pushers on the streets.
Real estate owner Donald Love takes advantage of the feud between the Yakuza and the Cartel to drop sales in real estate. Love sends Claude to steal a Cartel Cruiser to disguise as a Cartel member and kill Kenji Kasen on the parking lot roof in Newport. This action causes Kenjis sister Asuka to make an open attack at Fort Staunton, taking full control of the construction site.
Cartel Leader Miguel was blamed for the death of Kenji and was tortured by Asuka to reveal the Cartel's plots to sell Spank across Liberty City. Asuka sends Claude to destroy the Cartel's operations by destroyed SPANK stands instead Coffee stands vendors around Liberty City, killing Cartel assassins to kill Claude, and to collect packages of Spank in a plane making it's last flight to Francis International Airport. The Cartel soon return to the construction site to kill Miguel and Asuka.
After the game storyline is finished, the Yakuza and the Cartel still dividing their territories and Fort Staunton, resulting in gun shots every minute the player cross the neighborhood.