The game is inspired by Rockstar Games' Grand Theft Auto games, in that the player can complete a variety of missions within an enormous city that is open to explore. During development, around 50 story missions and 30 challenge levels were planned.[6] Gameplay elements shared with GTA include the vast assortment of weaponry, the miscellaneous shops, the ability to hijack vehicles, and the ability to attract police attention with violence and destruction.

As a homage to numerous 8-bit video games, Retro City Rampage incorporates design elements from many different genres, and features 16 graphical filters that simulate various retro computers and game consoles. Although it is primarily played from a top-down bird's-eye viewpoint, in specific sections, it may switch to a strictly two-dimensional perspective in the style of a 2D platformer.

The game also includes a "Free Roaming Mode" that allows players to freely explore the city and cause as much chaos as they can. This mode can also be played with unlockable characters from other indie developed games: like Super Meat Boy, Commander Video from the Bit.Trip series, and Steve from Minecraft, among others.