Unlike its namesake from Sonic the Hedgehog 3, Angel Island Zone is set in ancient ruins high above the island's landmass, giving it a closer resemblance to Sky Sanctuary Zone and a slight resemblance to Marble Garden Zone than the forest-like Zone it shares its name with. Alongside a number of booby traps, such as moving platforms, floating spikeballs, and sand falls, the Zone also contains many old contraptions that can help the player. These include such as rolling balls that the player must run on the make them move, as well as overhead rails and hanging handles that elevate the player when used. Failing to use some of these contraptions will dump the player into bottomless pits, which appear often during the level.
Angel Island Zone also contains many shout outs to the original Angel Island Zone and other zones that appear in Sonic the Hedgehog 3 & Knuckles. The E-02 Rhinotank and Wamu enemies are very similar to the RhinoBot and Catakiller, Jr. enemies respectively. The bouncing cloud platforms are similar to the ones found in Sky Sanctuary Zone, and the zone's boss is very similar to the boss of Hidden Palace Zone from Sonic & Knuckles.
The boss of Angel Island Zone is Mecha Knuckles. The fight starts out with the boss using Spin Dashes, Glides, and punches to harm the player. However, after Mecha Knuckles gets hit four times, its outer shell will break off, revealing a more sinister-looking metallic endoskeleton underneath. In this form, its speed is greatly increased, and gains a new attack in which it launches a barrage of giant homing missiles from its mouth.
After five more hits, Mecha Knuckles will be destroyed and Dr. Eggman, who was overseeing the fight from off-screen, panics and flees, leaving a capsule behind which allows the player to rescue the trapped animal friends and finish the level.