The protagonist receives a strange book on their birthday from an unknown sender. Howard Blackwood, the local mailman, assures the player that the book was meant for them before he departs. The protagonist opens the book and finds that all of their memories are written in it. Curious, the protagonist decides to change some memories before falling asleep. When they awaken, they find themselves in an Otherworld-like dungeon.
After traversing the dungeon they locate Howard Blackwood, who appears to be running a general store (Howard's Shop) within the dungeon. Howard introduces the protagonist to a substance known as "Memory Residue" and explains that in order to change the protagonist's past, the substance must first be collected. After the protagonist finishes exploring the dungeon, they awaken the next morning back in reality. However, after falling asleep the following night, the protagonist finds themselves back in the dungeon. When they awaken on the third day, the protagonist realizes that what they wrote in the book has become reality. With this new power, the protagonist continues to rewrite recent past events at their discretion while each night they encounter a new zone within a particular dungeon.
In-game clues and notes suggest that the Book of Memories was created by the Order with the purpose of bringing their God's will to Earth via its writings. An alchemical journal page details three elements considered to be the base of all things. "Light: borne by the Heavens; Blood: borne by this world; and Steel: borne by mankind, and the most powerful". The rest (Fire, Water, Earth and Wood) are considered lesser elements.
Depending on the protagonist's Karma Meter, the characters affected by the Book's powers will meet different fates when the protagonist changes the past.
The dungeons and their respective characters are as follows:
- Fire Dungeon (Derek Copeland) - Derek is one of the protagonist's co-workers who has recently beat them out of a job promotion. After the player rewrites their past, they receive the promotion instead, while Derek is suspected of stealing money from the company and either hastily quits or is transferred to another store.
- Wood Dungeon (Katie Collins/Matthew Collins) - The protagonist has a chance encounter with an old high school crush. The protagonist rewrites their past so that their crush, Katie or Matthew (depending on the protagonist's gender), breaks off their current relationship with Trent or Ashley respectively, and instead asks the player character to go out with them.
- Light Dungeon (Graham Reynolds) - Graham Reynolds, a police officer and family friend of the protagonist, appears to have been sitting in his patrol car outside the player's parents' house while they've been house-sitting it with their sister. This makes the protagonist nervous, so in order to throw Reynolds off their trail, the protagonist rewrites the past. It is revealed via notes that Graham and his wife Lorelai Reynolds have had a shaky relationship recently, and he has been having an affair. The protagonist's intervention either results in Graham's wife filing for a divorce and taking their kids with her, or the two reconciling after Graham solves a major case. In both scenarios, the protagonist concludes that Reynolds won't have enough time to worry about them or their Book.
- Water Dungeon (Trent Baker/Ashley Baker) - Trent/Ashley (the spurned lover) begins harassing the protagonist out of jealousy and desperation. The protagonist decides to take care of the problem by writing in their Book. At one point, it is revealed that Trent/Ashley was in possession of their own Book prior to the protagonist receiving their Book of Memories, but it was stolen in a mugging. After defeating the Water Guardian, Trent/Ashley stops calling the protagonist either because they suffer an accident that renders them amnesic, or because they find a new love interest.
- Earth Dungeon (Jack Merrick) - The protagonist is attacked by a man who claims to have his own Book of Memories. The man, Merrick, threatens the protagonist, informing them that he knows where they live and work, and that he intends to take their Book. It appears that the man is a convicted felon who had been arrested by Officer Reynolds in the past for attempted murder, among other charges. It also appears that Merrick had used his Book to aid him in his various crimes and to evade the police. At the end of the dungeon, due to the player's intervention, Merrick is either severely beaten by law enforcement to the point of permanent brain-damage, or he is arrested and his Book is placed in an evidence locker.
- Blood Dungeon (Shannon) - The protagonist's sister, Shannon, has been distant to the protagonist as of late, which causes them to worry. Notes imply that Shannon has been suffering from depression for an extended period of time, and it is revealed that Shannon was the woman that Graham is/was having an affair with. Depending on the Karma Meter, Shannon either sends the protagonist a goodbye letter before attempting suicide, or she sends them a letter thanking them for always being there for her, and letting them know that she is optimistic about her future.
- Steel Dungeon (protagonist) - The protagonist realizes that each specific action in the nightmare-worlds have had a direct effect on the past. They also realize that the Guardians they have been fighting represent the other characters' wills and desires, and that by defeating them, they have been asserting their own will over the others. From this it is concluded that when one individual benefits from the Book's powers, another must be adversely affected in order to restore karmic balance. Regretting their interference in the others' lives, the protagonist decides they must find the Steel Guardian before someone else does, and in doing so, find a way to undo the damage they've caused. In their trek through the dungeon, the protagonist finds the rewrites they've made to their Book: "I wish I'd gotten that promotion," "I wish Katie/Matthew and I were dating," "Officer Reynolds needs a distraction to keep him off my trail," "Trent/Ashley should just forget about Katie/Matthew," "Whoever that guy is, he can't EVER use his Book." The protagonist eventually confronts their Guardian at the end of the dungeon and expresses their intent to destroy it. The Steel Guardian informs the protagonist that they are the same being and that the Book simply gave the monster its physical form, therefore, it can never be destroyed. The two engage in battle and the protagonist subdues the monster, then awakens back in reality.
The protagonist's Karma Meter, and positive outcomes vs. negative outcomes affect the ending achieved.
- Pure Light ending: "I use the Book to help others." The protagonist decides to stop using their Book for selfish reasons and instead use it to help others, thus controlling the Book's impact by assimilating others' misfortune in order to restore karmic balance. This decision ultimately leaves the protagonist weakened and very ill, lying in a hospital bed. At some point during their stay in the hospital, they overhear a woman speaking with a doctor about about how her daughter's life-threatening condition is quickly worsening. The doctor regretfully informs her that there is not much else they can do for her daughter. The protagonist then makes changes to the Book in order to save the girl's life, but at the same time, this causes the protagonist to wheeze, indicating that their own condition is simultaneously worsening.
- Light ending: "I'll make sure the Book never falls into the wrong hands." After the protagonist decides that they are done trying to change things, they lock the Book away so that no one else can be affected by its powers. They then turn on the television, and flip through the channels, each station broadcasting a different disaster or tragedy occurring somewhere in the world or in a movie. The protagonist then walks over to the drawer that they placed the Book in and unlocks it. They hesitantly repeat to themselves, "I don't need to change anything...," while staring at the Book.
- Neutral ending: "I have to make everything perfect." The protagonist muses about how, though difficult at first, they eventually began to notice a pattern in how the Book's powers work, and have since slowly taken advantage of it to positively affect the outside world. It seems that the protagonist has become obsessed with making everything "perfect." They achieve this through making small adjustments to the world, while balancing the Book's karma in order to create a perfect world. The protagonist spouts, "I'm so close. Just a few more lines [and] the whole world will be perfect, ordered, and happy." It is then revealed that the protagonist has actually suffered a mental breakdown and has been hallucinating the whole scenario, while being held within a psychiatric facility.
- Blood ending: "I'm going to destroy this thing." The protagonist decides that after all the harm the Book has caused, it must be destroyed, as simply throwing it away could allow for it to be discovered. The character attempts to rip out the pages without success. They then try destroying the binding with an axe, but the book endures the bludgeoning. Finally, the protagonist attempts to burn the Book, which successfully destroys it. As they watch the Book smolder, the protagonist states their relief in finally being freed from the Book's influence.
- Pure Blood ending: "I have the only Book." The protagonist decides to keep and continue using the Book to fulfill their own selfish desires, such as using it to win the lottery, become a rock star, travel the world, and get married (at the expense of their partner's wishes). Eventually, the protagonist finds their wife or husband writing in the Book, claiming that they need a change; a simpler life. This leads the protagonist to conclude that that they can no longer trust anyone, and in response, "writes" their spouse out of the Book. Paranoid, the protagonist hires a private army to defend their home against any potential intruders who might want to steal the Book. The protagonist lives in isolation for some time, until the writing on the pages mysteriously begins to vanish, which infuriates and confuses the protagonist.
- Joke ending: The joke ending is illustrated in a comic book-style format. A group of tourists, Matt (rocker male), Derek (bookworm male), Trevor (jock male), Kayce (rocker female), Katie (preppy female), and Becca (bookworm female) decide to meet up and spend their spring break vacation in Silent Hill. In the meantime, they bump into characters from previous installments, such as Harry Mason, who asks them if they have seen a girl (Heather). Heather appears to be working as the front desk clerk at Jacks Inn where the characters stay, and sarcastically mutters "Tourists" under her breath as they leave. She is then told that the guest (Harry Townsend) in Room 302 accidentally locked himself in his room again, causing her to slump her head down on the desk in frustration. While in the motel, the creepy bellhop, Walter Sullivan, asks the tourists if they are interested in room service, but they refuse. The women decide to head to Toluca Lake, on the way running into James Sunderland and Mary Shepherd-Sunderland, who accidentally get sneezed on by Becca, causing James to become concerned for his wife's health. At the lake, Mira can be seen playing in the sand, and Alex Shepherd appears to be supervising his brother, Joshua, while he swims. There, Katie asks Kayce about her recent nightmares. The men decide to explore the town, when they spot Lisa Garland passing by, and Matt, who is dating Katie, comments on her cardigan. Cybil Bennett arrests Trevor for checking her out, and he meets Murphy Pendleton in the back of the squad car. Travis Grady appears on the side of the street with a sign, asking for gas money.