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Three years ago, Shintetsu, the Craftlord of Iron (one of the seven Craftlords), gave up his life to protect his wife Amariss, their child, and the whole of Wystern, and was honored as a hero for his sacrifice. Three years later, the remaining Craftlords organized a tournament to replace the role of Craftlord of Iron. The player takes on the role of the child of Shintetsu, and fights to earn the title in honor of his/her father. However, the foreign nation of Deigleya have plans of their own, as well as a thousand-year-old forbidden secret that was the truth behind the tournament.
The child of Shintetsu fights through the tournament and wins every match presented to him/her, however, strange natural disasters are affecting nearby settlements, and earthquakes are prevalent throughout Wystern. A mysterious figure follows the child of Shintetsu throughout his/her journey, and eventually presents him/her with the Western Sword. The Western Sword was once used to seal a great evil, but the player becomes entrusted with the weapon once the seal became ineffective. Before the tournament can be concluded, the player learns of a building unrest among the craftlords, and discovers Lubert, Craftlord of Amber, and Ureksa, Craftlord of Jade, are attempting to harness the power of the destructive spirit Parista, and have struck a deal with the neighboring warfaring nation of Deigleya in exchange for sharing control of the beast. It is later discovered that Ureksa was the brother to the former Craftlord of Jade, Rumari, and it was because of Rumari that Parista had accidentally been awoken three years ago. The Western Sword, along with the Eastern and Northern Swords, were crafted by Shintetsu in order to seal Parista once more, but upon learning these three swords would be ineffective, he poured his own soul into a fourth sword, the Southern Sword, and sacrificed himself in the process. The player learns that the tournament in order to take the place of the Craftlord of Iron was simply a distraction for the populace while the Craftlord circle fought amongst themselves for a plan of action in dealing with the beast of destruction, Parista. While Parista was the spirit of fire, the spirit Kuhrya was the spirit of ice and the polar opposite of Parista, and guarded the Southern blade until the child of Shintetsu would claim it and send Parista back into the spirit world. Upon gaining the final blade, the player enters the final battle with the spirit Parista, and fulfills his/her destiny. While the tournament was simply a formality, the player earns his/her place as the Craftlord of Iron and saves the world from destruction.