On the continent of Tellius, a land blessed by the goddess, two peoples are embroiled in a protracted struggle for power: the beorc, who rely on weapons and wisdom to win the day, and the laguz, who transform their very bodies to fight with tooth and claw.
Despite many clashes between these two groups, the continent's seven nations manage to come to a delicate truce—at least until Ashnard, the king of Daein, leads a sudden and decisive invasion against the neighboring kingdom of Crimea.
The Greil Mercenaries, a beorc company led by their commander Greil, make for the front lines to investigate the newly brewing conflict.
There Ike, Greil's son, comes upon none other than Princess Elincia—a woman who was raised in the gilded cage of Crimea's royal court, and who now finds herself alone and desperately seeking protection. The Greil Mercenaries carefully consider their options and ultimately decide to take on the job of seeing her safely to the neighboring kingdom of Gallia.

This game introduces several new systems. Units now have unique biorhythms, which grant them shifting bonuses and penalties to stats such as hit rate and avoidance. Three species of laguz—beast, bird, and dragon—present an entirely new way of fighting. Players can now swap skills between units for greater customization. In battle, certain units now have access to a Shove command to push another unit one space away.