Another shooter in the Cotton saga. Trouble brews in the homeland of Cotton's long time friend Silk, as the evil demon Suede steals the legendary Willow candy from the queen's castle. Seeing as how no one can face Suede and his forces Silk drafts Cotton in order to restore peace to her land, but she may have forgotten that Cotton is a big fan of Willow candies herself...

Gameplay-wise Rainbow Cotton actually follows in the steps of Panorama Cotton as the gameplay switches from a 2D perspective to a 3rd person one. The gameplay itself however is reminiscent of games like Panzer Dragoon, in which you don't control Cotton as she flies, but instead where she aims with her magic spells. You can shoot down enemies as well as open chests, doors and other bonus locations for power-ups and spells, which advance Cotton's abilities in an rpg-lite fashion and increase your arsenal with different magical powers.

Taking advantage of the technological advances, the game uses for the first time polygonal graphics and to complement the action the game features 2D animated cutscenes between levels.