Street Fighter II had been a huge hit, but one thing was clear: people wanted to be able to play as the four boss characters. Only the CPU could use Balrog, Vega, Sagat and Bison. Capcom set about on making an updated version of Street Fighter II, and it was released in 1992. Street Fighter II' Champion Edition finally let people play as the four bosses, plus all of the characters from the previous version of the game returned.

However, being able to play as the bosses wasn't the only thing this new version did. Several of the backgrounds were changed, the A.I. was toned down on the bosses, mirror matches were available and more. Many moves were changed slightly, such as Ryu's hurricane kick now knocking down the opponent if it hit, and Bison could now do his psycho crusher much faster than before. It was also slightly harder to get stunned.

This was the greatest fighting game available in 1992, but it was so successful that certain companies decided to illegally hack the game and then release it in arcades. These hacked versions become a problem, because in certain arcades they became more popular than the real thing. To take care of that, Capcom quickly started work on their next update to the Street Fighter II series: Hyper Fighting.