Mickey Mouse: Magic Wands! is the successor to Mickey Mouse IV: Mahou no Labyrinth and follows the gameplay formula of the Crazy Castle series. Mickey and his friends go for a walk and find a mysterious castle. As it turns out, it belongs to an evil witch who kidnaps everyone but Mickey. So of course his goal is to travel through the castle and rescue the other Disney characters.

The overall 40 levels are a mix between regular platforming (jumping over platforms and avoiding enemies) and puzzle solving, e.g. using a switch to open up a way. The only way to rescue Mickey's friends is to find all hidden portrait pieces which, at the same time, is the winning condition for each level. In addition, there is a boss to defeat after all ten levels. This also upgrades Mickey's magic wand with new abilities, e.g. making water to ice, which are needed for puzzle solving. Other collectibles which can be found in the levels are crystals which may reward items when the wand is used on them, e.g. energy bar refreshments, keys (required for progress) or apples (the only weapon in the game). The levels scroll in all directions.