Transformers: Revenge of the Fallen is set a few years after the defeat of Megatron in the first game. The game is a linear third-person shooter that puts the player in control of many of the main characters from the movie, shifting between both Autobot and Decepticon factions.

The storyline is told via cutscenes that also allow for the player to easily transition from one character to the other. Playable characters on the Autobot side include: Optimus Prime, Iron Hide, Jetfire, Bumblebee. The Decepticon side includes: Starscream, Sideways (a new character), and Megatron.

Though the game doesn’t allow transform wherever the player wants to, transformation has been introduced as special attacks during robot mode, as fixed alternate game modes (driving Shanghai tunnels as Sideways, and fly through the skies of Russia as Starscream) and, in both robot and vehicle modes, as special moves that give the player alternate abilities. For example, transforming as Starscream while flying will enable him to fly backwards as a robot to take out enemies behind the protagonist.

For multiplayer, at any point during a single-player campaign a friend can join in as a "Remote Weapon System", which allows them to shoot enemies, erect a shield to defend and transfer energon between both players.