The movie would be set five years after Shrek: Forever After, and Puss in Boots: The Last Wish as Fergus, Farkle and Felicia are now six years old.
Puss in Boots reunites with Shrek, Fiona and Donkey and properly introduces them to Kitty Softpaws and Perrito. Donkey and Perrito become fast friends, due to their similar personalities. Kitty also becomes good friends with Fiona, although the former is annoyed by Fiona's bad manners.
The main villain would be Red Riding Hood (aka Gretel). Her plan is to restore Duloc to its former glory, after Lord Farquaad's death. After Gretel and her brother Hansel had an encounter with a witch, she wanted to get rid of all fairy tale creatures. She also saw Lord Farquaad as a role model. When Lord Farquaad was eaten by Dragon, Gretel had a falling out with Hansel, who along with their parents decided to move on with their lives. Gretel then adopted the Red Riding Hood persona to win people over. However, the real Red Riding Hood didn't like how Gretel was ruining her reputation.
Gretel would also take over the Fairy Godmother's potion's factory, and hire Prince Charming as a reluctant lackey to ruin Shrek's reputation.
• • Like Shrek Forever After, Shrek 5 would reference the events of the first film, but it would also reference the second film.