Thor kills Malekith and saves the nine realms. He disclaims his right to ascend to the throne of Asgard so that he may instead return to Earth to be with Jane. It is then revealed that Loki is actually not dead, but has disguised himself as Odin (the real Odin's fate is unknown) and secretly sits on the throne as Asgard's king.
The film begins by recounting a war between Thor's grandfather Bor and Malekith (Christopher Eccleston), the leader of the Dark Elves. Malekith wishes to plunge the entire universe into eternal darkness, which would allow the Dark Elves to be the supreme rulers of the universe. Malekith has harnessed the power of the "Aether" and plans to use it to destroy the nine-realms when they are all in alignment - an occurrence that happens once every 5,000 years called the Convergence. The Asgardians manage to steal the Aether from Malekith before he can use it. Seeing his defeat is nigh, Malekith orders his people to sacrifice themselves so he and his generals can escape and try to restore darkness at the next Convergence. The Aether cannot be destroyed, so Bor orders that it be hidden away where no one can find it.
Returning to the present, it has been two years since the events of the first film (and two years since Thor has seen Jane). Thor (Chris Hemsworth) has matured greatly since the last film and has successfully fought to bring peace to all nine realms. His heart is still on Earth, home of Jane Foster (Natalie Portman), the woman he loves. Meanwhile, Thor's brother Loki (Tom Hiddleston) has been put on trial for his invasion on Earth(as seen in the Avengers) and sentenced to eternal imprisonment. Though Odin (Anthony Hopkins) and Thor have disowned him, he is still visited by his mother Frigga (Rene Russo). who unsuccessfully tries to get him to both admit to and repent for his evil ways.
It turns out the Convergence is once again approaching, causing distortions of the laws of Physics throughout the nine realms. Jane Foster, along with her intern Darcy Lewis (Kat Dennings) and Darcy's intern Ian Boothby (Jonathan Howard), begin studying these distortions. They discover that the Convergence is also creating portals between the Nine Realms. One portal sucks Jane Foster in to a realm where the Aether is hidden. The Aether then attacks and merges with Jane, and the immense power it contains begins killing her. Thor learns of her sickness and travels to Earth, taking Jane to Asgard to try and find a way to remove the Aether. Odin is not pleased that Thor has fallen in love with Jane, but agrees to help Jane find a way to separate from the Aether. Meanwhile, Darcy and Ian track down Dr. Erik Selvig (Stellan Skarsgård), who has gone a little crazy since Loki took over his mind, to help them find a way to stabilize the distortions and portals caused by the Convergence.
Malekith senses the reemergence of the Aether on Asgard. He imbues his top-general Algrim (Adewale Akinnouoye-Agbaje) with "Kurse" magic and they have him set-up to be arrested and taken to prison on Asgard. Once there, Algrim uses his formidable powers to break out and cause a riot amongst the other prisoners. Loki directs him to Jane's location. Meanwhile, the Dark Elves launch a full-frontal assault on Asgard. During the fight, Malekith finds Jane, but is confronted by Frigga. The Asgardian almost manages to kill Malekith, but Algrim arrives just in time to kill Frigga. Thor arrives moments too late to save her, though he does wound Malekith. The Dark Elves retreat for the time-being.
Thor wants to bring Jane to the Dark Elves so that Malekith can remove the Aether from her body (and Thor intends to attack the Aether and Malekith once it is withdrawn). Odin says the plan is too risky and they will try to protect Jane in the palace until the Convergence is over. Thor is upset that Odin will sacrifice the lives of his own people rather than take a chance to save Jane and defeat Malekith. Odin orders all means of transport between Asgard and the other Realms closed and declares it high-treason to have Jane freed from the palace. Having no other alternative, Thor breaks Loki out of prison to help him get off world (as Loki alone knows secret means of leaving Asgard). Loki agrees to help, as he regrets helping Algrim and wants to get vengeance on the Dark Elves for killing Frigga. With the help of Sif (Jaimie Alexander), Heimdall (Idris Elba) and the Warriors Three, Thor and Loki rescue Jane and take her off-world to the realm of the Dark Elves.
Once they are in the Dark Elves' realm, they approach Malekith. Loki pretends to betray Thor and cripple him, but once Malekith removes the Aether from Jane, Loki and Thor attack. Their attack does not prevent Malekith from bonding with the Aether, and his minions attack so that he can escape and activate the Aether during the Conversion. Thor is beaten by Algrim and almost killed, but Loki intervenes and sacrifices his own life to protect Thor. Thor swears to avenge Loki's honorable death, and Jane helps Thor determine that the Convergence will come together on Earth. Thor then transports he and Jane back to Earth so that they can confront Malekith. Erik, Darcy, Jane, and Ian develop a device that, when activated, should stabilize the portals and distortions at the site of the Convergence.
The day of the Convergence arrives, and Thor goes to confront Malekith. The two engage in battle that, thanks to the distortions and portals, causes the combatants to constantly fall into different realms and also interferes with their attacks. Jane and company are finally able to stabilize the area so that Thor can launch an actual attack on Malekith. Thor manages to kill Malekith and wrest control of the Aether, stabilizing its form and stopping the universe from being plunged into darkness.
Thor returns to Asgard, with Jane worried that it may be years before she sees him again. Darcy and Ian have begun dating since Ian saved Darcy's life during the Conversion. Odin praises Thor for his heroic actions and his cemented status as protector of all nine realms, asking Thor to rise to the throne. Thor disclaims his birthright, saying he would rather live in the Earth realm with Jane than be a king of Asgard (also stating that he wants no part in the King's duties to sacrifice his people during times of war). Thor leaves with Odin's begrudging acceptance of his choices. After Thor leaves, we learn that "Odin" is actually Loki posing as Odin. Loki has survived his apparent death and is now the undisputed King of Asgard (the fate of the real Odin is unrevealed).
Post Credit Scene 1 - Sif and Volstagg (Ray Stevenson) are aboard a spaceship that is home to an eerie museum. Their disdain for the place is palpable. They then meet The Collector (Benicio del Toro), who is the owner of the ship and museum therein. They give the Collector the Aether, referring to it as an Infinity Gem. They note that the Asgardians are already in protection of the Tesseract/Cosmic Cube - another infinity gem - and that it isn't a good idea to have more than one of them in the same place. The Collector promises to keep the Gem safe. Once the Asgardians leave, however, the Collector reveals his true intentions, saying "one down, five to go."
Post Credit Scene 2 - We watch Thor return to Earth and passionately embrace Jane. Meanwhile, a creature from the realm of the Frost Giants that was transported to Earth during the Convergence runs about in the background, trying to eat some birds.
Thanks Evan B!