Mr. Lao is a store owner at Chazke Village and the grandfather of Lime, a young girl who meets Gohan prior to the Cell Games. Mr. Lao first meets Gohan when the young boy is trying to buy items for his mother. Shortly later, he has Gohan chopping up wood for him. When his granddaughter starts a rumor that Cell is nearby the secret hideout that was built as protection, Mr. Lao comes to her aid. He beats up Mr. Borbonne's men with ease and is then opposed by Mercenary Tao who proves to be just a little too much for him to handle.
Mr. Lao is saved by Gohan from a Super Dodon Wave. Goku arrives and talks with Mr. Lao like they know each other. Amazingly, this elderly martial artist is well aware of Goku and Gohan's super powers and knows beforehand that they will be entering the Cell Games. Even more startling is the fact he knows Cell's first form objective was to absorb human energy and even stated that Cell was much weaker back then.
It is never told how this wise old man knew about Goku or Cell's evolution, being that the earthlings just knew him as a monster. However, being a martial artist himself he may have known about Goku through participating in or watching past World Martial Arts Tournaments.
- Mr. Lao's hairstyle strongly resembles that of Master Mutaito, who once trained Goku via time travel. Lao also strongly resembles the Fighter 83 who lost to Goku in the Elimination Round of the 21st World Martial Arts Tournament. Lime mentions that he once fought in the World Martial Arts Tournament, but as he made no appearances in the manga, it leaves this as a mystery.
- Besides not having a beard, Mr. Lao also resembles Jackie Chun (Master Roshi), who is also thought to be modeled after Mutaito.
- His name is revealed in the FUNimation dub and the booklet included with FUNimation's Dragon Box Five and only at the end of the anime when Gohan says "Thanks Mr. Lao."
- A variation of Mr. Lao appears in the first arc of Dragon Ball Z: The Legacy of Goku II as Robert, the man who steals the key to West City that was meant for Mr. Satan (although, Mr. Satan was obtaining the key for defeating a warlord that Robert had defeated for making too much noise in the wilderness). Gohan chases him through the city and the forest to regain that key and continue the events of the game.