When playing as Sonic, Angel Island Zone begins with a short introduction sequence. Sonic and Tails discover the Floating Island in their biplane, Tornado. With the Chaos Emeralds from Sonic the Hedgehog 2 still in his possession, Sonic leaps off the plane and becomes Super Sonic, skimming across the sea and onto the island, where he bumps into Knuckles the Echidna and drops the Emeralds. Knuckles steals Sonic's Emeralds, laughs and runs off. When playing as Tails or Knuckles, this intro does not play.
Halfway through Act 1, a horde of Flame Crafts appear and set the Zone on fire. This completely changes the background of the level, from its lush peaceful surroundings to an inferno. One of the Flame Crafts returns as a mini-boss at the end of Act 1. In Act 2, a huge warship known as the Flying Battery flies overhead and attempts to kill the player by dropping large bombs. The player must avoid these bombs and outrun the ship until it flies away. When playing as Knuckles, the Flying Battery is not encountered.
After facing Dr. Robotnik in his Flame Craft and opening the Zone's Capsule, Sonic and Tails again encounter Knuckles, who presses a switch that breaks the bridge they were standing on, in order to send them into the next level of the game: Hydrocity Zone.
The boss for this level is Dr. Robotnik, flying in a modified Egg Mobile also called the Flame Craft. The Flame Craft has two aiming weapons on either side that shoot fireballs across the arena. It takes eight hits to destroy the Flame Craft.
There is a glitch in this level that causes the Act 1 music to change to Act 2 music after the completion of a Special Stage or Bonus Stage in Act 1. This was fixed in Sonic the Hedgehog 3 & Knuckles.
When moving on to Act 2, the player still has access to a large portion of Act 1.
After defeating the Act 2 boss, when Knuckles destroys the bridge, Sonic or Tails can jump off just as it falls apart and roam around on the ledge where the boss battle was fought. Also, Tails can fly on the platform where Knuckles is at. In co-op mode, it is possible for him to carry Sonic up to this area as well. Knuckles' theme music repeatedly plays, and Knuckles just stands there laughing. The Zone does not end until Sonic or Tails falls down either of the two gaps where the bridges were.
An alternate version of the Sonic the Hedgehog 3 intro featured Sonic surfing onto the island, which was replaced in favor of Knuckles knocking the Chaos Emeralds from Super Sonic. The Sonic surfing sprites can be viewed in Debug Mode.
When playing as Knuckles, you can see the sky in some parts of the background in Act 1, as to which when playing as Sonic and/or Tails you could see the ocean which shows that Knuckles' story takes place after Sonic and/or Tails.