Taken directly from Lagoon's North American SNES manual, the story for the game is as follows:
Who shall rise to face this threat?
Long ago the peaceful land of Lakeland fell under the influence of an evil spirit, bringing despair to all. With compassion, the gods descended and vanquished the evil spirit with the sacred Moon Blade Sword. In hopes of restoring peace to Lakeland, the gods brought two babies to the land: one who represented the forces of Light, and another who represented the forces of Darkness. A sage named Mathias was charged with the responsibility of raising the two children as equals in the hope that their different, but equivalent strengths would guarentee the balance of the forces of Light and Darkness. But, the moment Mathias reached out to grasp the two children, the evil Zerah appeared and took the child of Darkness, hoping to raise the child to overcome the forces of Light. This, while Nasir, the Champion of Light, was raised by the wise Mathias, the other child grew up under the questionable tutelage of Zerah. Fourteen years have passed. Nasir, raised near the village of Atland, has become a bright youth and accomplished swordsman. Mathias has taught him well. One day, an evil spirit possessed the water on which the people of Lakeland depend, bringing sickness and disease. Demons infest this once peaceful land.
Mathias spoke haltingly.
"It is for this day that I have trained you, Nasir. You must discover what evil force possesses and fouls the water. Restore the purity of the water or sickness and death will plague our land. This is your destiny!"
It is now your responsibility to rescue the land from the evil forces. You will face a myriad of enemies. Only by skillfully using your sword, magic, and wits will you prevail. Go forth, your quest awaits you.
Lagoon is a top-down action RPG with adventure and platforming elements. Players can move Nasir in one of four directions, and can also attack, jump, jump and attack, defend, or cast magic from each position. Of particular note, is the short range of Nasir's melee attacks. This is offset by the range of his magic attacks, which can reach the whole length of the screen. However, players may not rely on magic attacks alone. Certain enemies are invulnerable to it (like bosses), and must be dispatched with melee attacks.
The basic gameflow of Lagoon follows a town-overworld-dungeon pattern. In each town, players can talk to the various townspeople, buy items and equipment, and advance the game. On the overworld, players fight their way from location to location, sometimes having previous areas being permanently blocked. In the dungeons, which range from such locales as mines, castles, dungeons, and various elemental caves, players must seek items, equipment, and the bosses within.
The equipment and item system borrows heavily from Ys. As such, Lagoon has a very limted set of equipment to find, with only five pieces of equipment per sword, armor, and shield categories. However, unlike Ys, Nasir's color palette and equipped shield change to reflect the equipment status screen icon. Also borrowed from Ys is the five rings. Players can discover the Protective, Power, Defensive, Curing, and Time ring, all of which mirror the abilities found in Ys. The Protective Ring increases defensive power, the Power Ring increases offensive power, the Defensive Ring makes Nasir invincible to lesser enemies, the Curing Ring gradually heals Nasir, and the Time Ring stops the movement of weak enemies. During Nasir's adventure, he will also discover a plethora of other permanent and consumable items that will aid him in his quest. Of note, is that the status and equipment screen can not be accessed during boss fights, so players must prepare for battle beforehand.
Lagoon's magic system uses a mix and match system to give players a total of 16 magical attacks. Broken down into Fire, Wind, Water, and Thunder categories, players must find both a crystal and staff to make use of magical attacks. Scattered throughout the game is the Earth, Sky, Star, and Moons Staff, and the Fire, Wind, Water, and Thunder crystal. By mixing up which crystal and staff Nasir has equipped, different attacks with different properties can be activated. This important, as certain enemies are either immune or weak to certain elements.
Much like any other RPG, Lagoon utilizes a health, magic, gold, and experience point system. Defeated enemies automatically give players a set amount of gold and experience, and once a certain experience threshold is met, Nasir will level-up, gaining additional stats. Of note is the game's health and magic system, that regenerate, in any environment, as long as Nasir is standing still.
Exploration in Lagoon is done much the same as in any other top-down platformer. Players must navigate a multitude of environments, each with their own set of obstacles and dangers. Players must also be careful of pitfalls, or bottomless pits, as they will instantly kill Nasir if he falls into one. However, this is offset by the game's save system, which allows players to save anywhere outside of a boss fight.
This is the list of major characters in Lagoon, taken directly from the manual:
Nasir - Born to be the Champion of Light, the protagonist has become a skilled swordsman under the tutelage of the wise Mathias. He displays intelligence and courage beyond his years.
Mathias - Skilled in the art of the sword and in the ways of magic, he raised Nasir from infancy.
Thor - Aligned with the forces of Darkness, he is known as a skilled swordsman and for the fact that each of his eyes is a different color.
Zerah - an evil warlock, he is aligned with the forces of Darkness. He stole the child of Darkness from Mathias and raised him. He seeks to resurrect the evil spirit and bring the forces of Darkness to rule the land.
Felicia - Queen of Lagoon castle, she is the only one who has the power to open the door to the Secret Place and to move the Lagoon Castle.
Duma and Battler - Henchmen of Zerah.