The story is set in the fictional kingdom of Boletaria, ruled by the aging King Allant XII. Because of his greed, the king searched for power and prosperity through a dark ritual of channeling the power of souls that brought unprecedented prosperity to Boletaria, until the "Deep Fog" covered the land's outskirts, cutting off the kingdom from the outside world. Neighboring kingdoms sent scouts to investigate but none returned after entering the fog. It was only after Vallarfax of the royal Twin Fangs broke free from the fog that the rest of the world could be told of Boletaria's plight. By channeling souls, King Allant had awakened the Old One, a great demon residing below the Nexus. With the Old One's awakening, a dark fog had swept in that within it unleashed demons who feasted on the souls of mankind, where those left alive without a soul became insane and violent. Without resistance, the fog slowly begins to spread beyond Boletaria.
Many brave warriors attempted to breach the fog and save Boletaria while others were swayed at the prospect of harnessing the demon's souls, either way many were lost to the fog.The player takes control of one such warrior who breaches the fog and enters the lost kingdom, however shortly after entering, the lone hero adventurer is killed by a great demon. After dying, the hero, now in soul form, appears in the Nexus. In the Nexus, they are greeted by the Maiden in Black, a mysterious and blinded patron of the Nexus who gives them the quest to travel to each region of Boletaria and retrieve the demon's souls to gain power and eventually free the corrupted kingdom of Boletaria from the Old One.
One by one the hero slays the mighty demons that reside in many of Boletaria's notable locations; the Boletarian Palace, Stonefang Tunnel, Tower of Latria, Shrine of Storms and Valley of Defilement. It is also in these places where they encounter the few remaining great men and women of Boletaria. Once the hero claims all the demon's souls, the Maiden in Black leads them down below the Nexus to the Old One itself. The Maiden in Black beckons the Old One who invites the hero inside where the now deformed King Allant XII remains. During the final battle Allant claims that because of humanity's own violence and suffering, the Old One is acting mercifully by putting "an end to our tragic realm of existence." Upon Allant's defeat, his last words are a warning to the hero: "You fool. Don't you understand? No one wishes to go on."
During the end game the hero makes one last choice to either slay or walk away from the Maiden in Black. If the hero walks away, they have not succumbed to the temptation of the souls when the fog is lifted and the Maiden departs with the Old One back into the fog into its slumber once again, saving Boletaria and the rest of the world. If however they kill the Maiden in Black, they have become lustful for the power of souls, condemning the world with the hero as its ruler at the side of the Old One.