Double Dragon 3: The Rosetta Stone (ダブルドラゴン3 ザ・ロゼッタストーン) was released two years after the last entry, with the title being changed to Double Dragon III: The Sacred Stones when it was released to Western home consoles.  After training abroad for two years, the brothers encounter a fortune teller who informs them that to challenge the world’s strongest, they must seek out the Rosetta Stones that are scattered throughout the world.  This adventure takes players through the United States, China, Japan, Italy, and Egypt.

This entry into the series was not developed internally by Technōs Japan, but instead by East Technology, and was released first in the United States with cabinets accommodating up to three players, allowing gamers to play as Billy, Jimmy, and Sonny Lee - a new brother.  The game returned to the controls from the first game and introduced iconic attacks such as the hip-throw, knee drop, back-to-back Hurricane Kick, dual jump kick, and the headbutt.  The North American arcade also had the distinction of allowing players to use an item shop at the start of each stage to purchase additional weapons and power-ups with credits, an early instance of microtransactions.  The item shop was removed from the Japanese version, the difficulty was adjusted to be easier, and three additional fighters were added to the character selection.