The mystical sword of the legends, the "Soul Edge", ended in the hands of the dread pirate Cervantes of Spain. For the next 25 years he stayed dormant on the remnants of the port town in Valencia, Spain, taking the souls of those who reached him during their search of the sword. His reign of terror was soon to start, but the joined efforts of a divine warrior (Sophitia Alexander) and an underground ninja (Taki) stopped him, breaking one of the twin Soul Edge blades in the process. As it was about to tear itself apart, a young knight (Siegfried Schtauffen) approached the port town. The moment he took the hilt of the cursed blade, Soul Edge released a bright column of light into the sky. This was known as the "Evil Seed", bound to bring calamity and death across its path.
Three years after those events, Soul Edge uses Siegfried as its host, and now Siegfried is Nightmare, a knight wearing azure armor. Europe plunges into a vortex of slaughters as he and his followers claim souls to strengthen the blade in its weakened state. Unknown to them, a group of young warriors met on their journey to stop Soul Edge, and with them three sacred weapons join once again.