Two thousand years before the game begins, those who sat on Council of Seven in the land of Rivellon sacrificed themselves in the fight against a group of treacherous magicians, who had passed over to the dark side of magic. To remember the Council of Seven, the "Divine Order" was founded to pass on the knowledge of the wise men to the next generations.
At the beginning of the game, the player wakes up in a house in Aleroth, a town of healers. It is revealed that Mardaneus, leader of the town, has gone crazy, and the player is asked to help by traveling into the catacombs beneath the town to stop the undead mage Thelyron, who is driving Mardaneus mad. Once Thelyron is put to rest, Mardaneus appears to bring the player back to the surface.
With the crisis in Aleroth resolved, the player leaves to explore, and is ambushed by a dragon rider, but is saved by the appearance of the wizard Zandalor, who explains that the player is one of three Marked Ones, and asks the player to meet him at an inn. Shortly thereafter, the other two Marked Ones are discovered dead, leaving only the player. The player is invited to come to Castle Stormfist, home of Duke Janus, a young noble who claims to be the Divine, a messiah prophesied to protect Rivellon against the summoning of the demon Chaos. The player is forced to do menial tasks for Janus, and no matter what they do, they end up in a dungeon, and have to fight their way out.
Once free, Zandalor takes the player to where the Council of Seven met, and explains that in order to find the real Divine, the heirs to the Council of Seven have to be brought together. In doing so, the player learns more about the way events have been manipulated by the Black Ring, the evil organization dedicated to bringing the demon Chaos back to Rivellon; the orcs have been goaded into attacking humans, and the elves and dwarves are poised at the brink of war, until the player reveals the manipulation going on.
As the new council members assemble to complete the ritual that will turn the player into the Divine, Duke Janus appears, revealing himself to be the Demon of Lies, in league with the Black Ring and seeking to summon Chaos. The council is attacked and a number of the members slain, along with the player. The player returns to life, however, with new abilities as the Divine, and is able to reach the fortress where the Black Ring is summoning Chaos. The Divine defeats Janus, but finds a baby who was picked to be the vessel of Chaos, lying on the summoning altar, and carries the baby out in their arms.