When Ling heard of the death of Heihachi (who had been blown up when a group of Jack-5 robots attacked him, holding him down while one self destructed), she was greatly saddened. Hearing this, Ling came to the conclusion that the root of the misfortune surrounding the Mishima family started with Heihachi's cruel upbringing of Kazuya (whom Heihachi tossed down a cliff as a child, as he thought that if he survived it and climbed back up the cliff, in the end it would make him stronger). During the last tournament, Ling was saved from Heihachi and his evil plans by Yoshimitsu, who taught her the history of the Mishima family. Ling is a student at the Mishima High School, who, due to her friendship with Jin Kazama, is on a mission to save the Mishima family. Xiaoyu then tells Miharu that she wants the two of them to build her theme park together. Ling then offers her a job, and goes on to say that she saw Jin Kazama after the tournament, and that he told her that " has all of these dreams, and should make them happen for herself". Ling's friend, Miharu, visits her in her office and admits to Ling that she has flunked all of her college entrance exams. She was successful in unveiling the truth behind Heihachi and the Mishima Zaibatsu, discovering that they were behind the raid of G Corporation. In Ling Xiaoyu's ending video (which is once again non-canonical), we see that she won the tournament and has taken over the Mishima Zaibatsu.
Ling believed the message and became increasingly suspicious of Heihachi and the Mishima Zaibatsu, and upon the announcement of The King of Iron Fist Tournament 4, she decided to enter, hoping to be reunited with Jin and to unveil the truth behind Heihachi and the Mishima Zaibatsu. Ling's best guess that Jin, who had been missing since the last tournament, could have sent the message. Although she replied to the e-mail, she received no more e-mails from the anonymous individual. However, one day she received a mysterious e-mail that warned her that Heihachi had evil intentions and that her life is in danger. Lacking any particular goals, Ling grew tired of her everyday routines. Ling was a junior at the Mishima High School, where she lived, studied and trained. Ling is also the granddaughter and student of Wang Jinrei. Heihachi begins to burst out with laughter, until Ling attacks him, with the word "JERK!" appearing on the screen. Upon Heihachi turning all the lights on, we see a dark, somewhat bland amusement park titled "Heihachi Land".
We then see that this is Xiaoyu's day dream, with Heihachi about to unveil the real amusement park. In her non-canonical ending movie, we see a bright and colorful amusement park titled "Xiaoyu Land", with Xiaoyu and her pet Panda riding on a roller coaster, merry-go-round and going shopping. Heihachi, amused by the young girl, promises to build her the amusement park of her dreams, if she can win The King of Iron Fist Tournament 3. When Heihachi arrived, he found all of his men unconscious, and when he found Ling, she threatened that she would go berserk again if he did not accept her challenge. However, Ling was discovered shortly after the ship left port, and this was reported to Heihachi immediately. Ling found her way on board, only to discover that Heihachi was not on the ship. While on a vacation in Hong Kong, Ling saw a yacht bearing the name, "Mishima Financial Empire". Ling Xiaoyu's dream is to be able to build her own amusement park, and upon learning that the Mishima Financial Empire is rich and powerful, she seeks out Heihachi Mishima (President and CEO) to make her dream a reality. Her Friend Miharu is aware of Xiaoyu's feelings for Jin. She strongly hinted to have a crush on him due to her tekken tag ending in her school outfit, and her Tekken 4 prologue wishes to be reunited with him. Xiaoyu was born and raised in China, and is a student at Mishima High School (a school owned by the Mishima Zaibatsu), where she was a schoolmate of Jin Kazama. Ling Xiaoyu was introduced in Tekken 3 and has returned in every subsequent release.