Dragon Quest VII tells the story of a young hero, the son of a prominent fisherman in the village of Pilchard Bay on Estard Island, the only landmass in the world, and his friends in a fantastical, medieval-like world. They set out on adventures through the world's past and learn about its history. Upon discovering different lands in the past and solving the troubles, they reappear in the game's present-day map.

The party begins their adventure when the hero and Kiefer discover a mysterious fragment of a map that the former's father brings home from a fishing trip. Further investigations lead the hero to discover that the world he lives on, which seems to consist of only his small island, used to contain many continents that have somehow been sealed away. By placing other stone fragments found throughout the journey on pedestals in Estard's ruins, the Hero and his friends are sent to different lands in the past which the party eventually realizes. Once they solve the problems in the area's past, the landmasses appear in the present.

After the world is restored, Orgodemir, the Demonlord, disguises himself as the Almighty and seals several of the islands away once again; this time Estard is sealed as well. The party sets out to revive the elemental spirits: Wind; Fire; Earth; and Water. Orgodemir is then revealed as the Demonlord to the world whereupon he claims to have done so to trick humanity. Orgodemir then raises the Cathedral of Blight; and with the aid of the Skystone, the party confronts him in a final battle.