Martial Champion follows the same fighting game conventions established by Street Fighter II: the player's character fights against his or her opponent in best two-out-of-three matches in a single player tournament mode with the computer or against another human player. The player has a character roster of ten fighters to choose from, each with their own unique fighting style and special techniques.
The control layout differs from Street Fighter II and most other typical fighting games inspired by it. Martial Champion's control system is derived from the control system of Yie Ar Kung-Fu, but simplified to simply high, medium and low attacks, instead of having to press an attack button and a direction. One unique feature this arcade game has is stages that are similar to the "high-jump" stages seen in Capcom's later fighting games such as X-Men: Children of the Atom. Another unique feature is that certain characters carry weapons which can be disarmed by their opponent and used against them.
There are ten playable fighters to select from. After the player defeats all ten opponents in the tournament mode (including a clone of their character), they face a final computer-controlled boss character. In the later localized worldwide versions, Chaos and Titi have their names switched (similar to the rotation of the boss characters' names in Street Fighter II, probably done to avoid associations with the word "titty"), with Chaos being a Chinese vampire and Titi being an Egyptian princess.
- Avu (アヴゥ) - A rotund Middle Eastern man armed with a scimitar. Billed as being from Saudi Arabia even though the displayed flag is Iraq's.
- Bobby (ボビー) - An eyepatched soldier from the United States similar to Guile.
- Chaos (ケイオス) - A Chinese vampire from Hong Kong. Utilizes a pair of metal claws and his tongue in battle. Known in the international versions as "Titi".
- Goldor (ゴルドー) - A French fighter utilizing a three-section staff or sansetsukon.
- Hoi (ホイ) - A Chinese martial artist from China.
- Jin (陣) - A Japanese martial artist who was inspired by Ryu from the Street Fighter series and Lee from the Famicom and MSX versions of Yie Ar Kung-Fu.
- Mahamba (マハンバ) - A spear-wielding tribesman from Africa.
- Racheal (レイチェル) - A blonde American female ninja.
- Titi (ティティ) - An Egyptian princess (the name derived from Nefertiti). Known in the US and World versions as "Chaos".
- Zen (禅) - A kabuki fighter from Japan.
- Salamander (サラマンダ) - The final boss and the tallest character in the game. He is unplayable and his move set contains techniques lifted from other characters.