The game begins with a presidential briefing in the White House concerning Yuri and how he has begun his take over of the world through mind control. Yuri interrupts the briefing to explain how he plans to take over the world, telling the American President Michael Dugan that he has a network of Psychic Dominators around the world, which he is now beginning to reveal. One of Yuri's Psychic Dominators is on Alcatraz Island in San Francisco, which Yuri activates just before ending his transmission to the White House. The President immediately calls in an airstrike on the device, but all the attacking aircraft were shot down, although one crashes into the nuclear reactor on the island, causing the device to lose power and to not function. Despite this, Yuri activates his other Psychic Dominators around the world and the majority of the planet quickly succumbs to Yuri's mind-control.

The storyline picks up right where the canonical Allied ending from Red Alert 2 left off. While the Allies concentrated on regaining territory and fighting off forces loyal to the now former Soviet Premier Romanov, the latter's advisor Yuri secretly raised an army of his own, using his immense knowledge of psionics and genetic mutation. As Yuri announces his presence and plans, a global network of devices called psychic dominators comes online in an attempt to enslave the entire world. The American president Dugan orders an air strike to destroy one of these devices on Alcatraz island, and although the attack failed, a crashed Harrier damaged the device's power supply. As all other psychic dominators go online, the Allies attempt to power a time machine to stop these events from occurring. At this point in the storyline, the player chooses to side with the Allies, or to join the Soviets and steal the time machine to also defeat Yuri, but at the same time restore the Soviet Union to power. Yuri's army does not get a singleplayer campaign, which is the first and only time in a series where a playable faction does not get singleplayer content.