Shanghai Karate is a one-on-one beat 'em up game. The player takes on the role of Lio Yin. By defeating all Wang Chen's men, Lio Yin must traverse the legendary journey from Changhun to Shanghai. The gameplay takes place on a single board. Each opponent has four lives and can be attacked through eight available strikes. The game offers a practice mode for a two human players, taking place in the Great Wall area. The game is not identical to the contemporary Shanghai Karate for Amstrad CPC published by the same company.