In order to gain access to the factory, Shantae must give Ammo Baron the targeting module for the cannon in Scuttle Town, unpetrify Barracuda Joe by giving back his spirit, and get Twitch and Vinegar away from Bran-Son by giving him his blade. Once all has been done, talk to Ammo Baron to trigger the event leading to the labyrinth's reveal.
The dungeon is relatively easy to get through, although it does require some tricky uses of Risky's Boots to break through a few obstacles. It is primarily populated by robots, such as Bots and Disarm Bots. Steel Maggot (Patent Pending) is the boss of the Factory.