Need for Speed: Underground 2, the sequel to the commercial hit Need for Speed: Underground, was released on November 15, 2004. A demo of the game was placed as a "late" easter egg in finished copies of the EA Games and Criterion Games collaboration Burnout 3: Takedown, and completed versions of NFSU2 also have a demo of Burnout 3 in the game.

In Underground 2, the story mode continues, but there are new racing modes such as the Underground Racing League and Street X, new and more tuning options, as well as a new method of selecting racesΓÇöjust driving around the city (similar to Grand Theft Auto and Midnight Club II) and selecting race "beacons". Also included is an "outrun" mode where a player can challenge random opponents on the road and the race leader will attempt to distance themselves away from the opponent to defeat the opponent (similar to Tokyo Xtreme Racer). Underground 2 also introduces several SUVs, which could be customized as extensively as other Underground 2 vehicles and used to race against other SUV racers.

The customization features in the game were significantly expanded to modifications that have no actual effect on vehicle performance. The sound systems could be put in the trunk of cars, but served no purpose other than sheer flash. The game also features more extensive product placement for companies with no connection to auto racing, such as integrating the logo for Cingular Wireless, an American wireless communications company, into the game's messaging system and displaying it on-screen for much of the gameplay. This game has extensive amount of customization in the form of suspension upgrades, nitrous systems and engine mods.

The performance and handling of the car is not only affected from "performance shops", but cosmetic modifications, like spoilers and hoods, which affect the downforce of the car.