The movie takes place fifty years before the game. Alteria is a land divided among humans, elves, beasts, and dragons. Decades ago, the elves and humans drove the beasts and dragons back into the Dark Mountains. Evil thrives on darkness and draws strength from it. Rage and fury gather in the gem possessed by the Black Dragon Karas, waiting for the dragon to reawaken.
In recent years, humans and elves have been fighting for territory. And because of this, they cannot see the common enemy and the greater evil coming their way. No one but the Elf Princess Nerwin can see the growing storm and thinks Alteria’s only hope is to forget the past and ally with the humans. She has decided to act on her own in secret – a courageous but foolish act.
Meet Lambert, a human who has a run-in with some beasts before being rescued by Barnac from his ship. Aboard the ship, he meets Barnac, the famous mercenary; Geraint, the famous dragon fighter; and Argenta, Geraint’s sister.
They stop in the kingdom of Saint Haven, govern by the human king, where Lambert finds and rescues Liya, an elven archer under Nerwin. Then the beasts Lambert encountered earlier, return. The beasts are defeated by Velskud of the Imperial Knights. Back in the castle of Saint Haven, Nerwin tries desperately to convince the human king to ally with the elves but it ends in vain. But when Velskud brings him a beast helmet and Barnac, Geraint, and Argenta join in the plan for alliance, the king reluctantly agrees.
When Liya sees a shadow near the king’s dining hall, she follows it, along with Lambert. There, they sneak into the dining hall where the king, Terramai (his advisor), Karacule (a very powerful sorceress), Nerwin, Barnac, Geraint, Argenta, and Velskud are having a meeting. They overhear that the dragon’s weakness is the gem in its chest. Legends have it that the gem can kill and revive the dead. Terramai feels the gem should be kept in Saint Haven. An argument over whom and where the gem should be kept breaks out until Lambert interrupts them with his plan. After telling his plan, both Lambert and Liya are kicked out of the room. From outside the door, they hear Geraint tell the group that the gem can corrupt the most innocent of minds so it must be destroyed.