Necky Nutmare takes place in a cave, and it is the last level to take place in one. Its name hints at the numerous Mini-Neckys and Neckys who appear in the level. The word "nutmare" is a pun on "nightmare", which references the numerous coconuts that the Mini-Neckys spit out. These enemies are the main hazard of the area, and sometimes even spit coconuts from a narrow crawlspace. The Kongs must carefully time their movements to avoid being hit by coconuts.
Necky Nutmare is mostly a generic cave level, although it is the first to feature gray Krushas. There are also some pitfalls that the Kongs must cross, either from using platforms or bouncing on flying Neckys. A few ropes appear as a means of safely alternating between the upper and lower floors.
The level starts by heading down a few small, stair-like structures towards a lower area containing two Mini-Neckies. After climbing up a nearby ledge, the heroes reach a DK Barrel and a gray Krusha at the bottom of another ledge. More ledges appear to the right, and some Armies appear from a hill behind the area. There is a nearby ledge that leads to a platform, where an oil drum stands. After a few more ledges, they encounter a few more Armies and then a low ceiling with a Mini-Necky immediately following it. A flat pathway ahead of here leads to a rope that goes to another area, where they can find two Mini-Neckies shooting at them on their left and right sides. The letter K sits in an alcove to the left of the rope. A wide abyss containing two Neckies and two ropes lead to a nearby set of Neckies. To the right is a stationary rope that leads to a flat area of land with a DK Barrel and a Krusha on it. Next, there are a set of three low ceilings with Mini-Neckies. The letter O is found after the first of the small passages and a Life Balloon after the second. After crawling through the three passages, there is a Banana Bunch, a Krusha, and a barrel. At the edge of the pathway, the heroes can find the level's Star Barrel.
The next area contains a pathway leading to the left and right. The pathway to the left leads into a dead-end with a Mini-Necky, but the opposite pathway leads towards several bananas and a small pit. There is a wider pit with another set of Neckies. On the other side, there is a DK Barrel and a small pit that is followed by a gray Krusha and several ledges. A straight pathway leads through an area with several Neckies and an Army. After this, there is a pit with two moving platforms and one that drops when stood on. The letter N can be seen and a hidden chain of Barrel Cannons send them back upwards.
Once a nearby pit is crossed, there are a pair of Armies on some small, stair-like structures, which are followed by a deep alcove with a Mini-Necky above it. A DK Barrel also sits in the area after it. If the heroes drop into the alcove, they can find a lower area containing a Krusha and a wide pit with a few small platforms in it. The letter G stands on one of the platforms, while an Auto Fire Barrel sits near another, which can blast them into the area upwards, near the previous area. After this, a sign saying "Almost There" can be found along with a Mini-Necky right after it. After passing another Mini-Necky in a unreachable area, there is a long section of the level with more Neckies and two platforms with one containing the DK Barrel. After another set of stairs, a gray Krusha appears next to a wide pit with more Neckies. On the other side is a non-functioning oil drum and the level exit.
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