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An experienced treasure hunter named Nigel is on a quest to obtain the valuable Statue of Jypta. After successfully recovering and selling the statue, Nigel meets wood nymph named Friday, who is being chased by a trio of thieves. The thieves assume that Friday knows the location of the mysterious treasure of King Nole. However, she does not appear to have the exact location in mind, and instead relies on her senses to track it. She offers Nigel to accompany him on a long journey and eventually lead him to the coveted treasure.

Landstalker is an isometric action game with platforming, puzzle-solving, and light role-playing elements. Much of the game is spent in dungeon-like hostile areas, where Nigel must often fight enemies, jump, climb ladders and ropes, and throw objects to overcome obstacles and solve puzzles. Nigel can acquire better weapons and armor, as well as items that permanently increase his hit points and strength. In towns it is possible to talk to non-player characters and buy items in shops. There are optional quests in the game, which may reward the player with attribute-increasing items.