Description taken from Arcade version of this game

Commander Borf has plans for Earth -- and they're nothing a human being would consider pleasant. With the power of his Infanto Ray, Borf plans to turn the planet's entire population into babies and take over the world. In order to stop this evil plan, Ace and Kimberly were sent to stop this gargantuan blue intergalactic conqueror. In the process, though, Kimberly was kidnapped and Ace was zapped with the Infanto Ray. Now he's a weakling named Dexter in a fight for his life.

Hot on the heels of Don Bluth's smash hit interactive cartoon Dragon's Lair comes Space Ace, a similar game in which you assume Dexter/Ace's role as Earth's last hope in defeating Borf. En route to rescuing your girlfriend and saving the world, you'll have to battle through legions of Borf's minions in several different settings, occasionally "energizing" to change from nerdy Dexter to the heroic Ace.

As he makes his way scene by scene, you must tell Dexter/Ace which direction to move with a simple movement of the joystick, often to a safe place featuring a blinking light. When there is no place safe to go, it's time to shoot your weapon. Timing is of the essence as the slightest screw-up in executing your movements can cost you a life. To make things easier, three skill levels are available -- "Space Cadet," "Space Captain" and "Space Ace." Though you can defeat the game via any skill level, only the "Space Ace" option allows you to view the entire movie. ~ Christopher Michael Baker, All Game Guide