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Sonic and his friends find a robot discarded on the beach who he quickly befriends and names Emerl. Being a blank slate at the beginning, Emerl discoevers that not only is he powered by chaos emeralds, but that he can learn the fighting moves of each character in the story. Later on it is discovered that Dr. Robotnik (Eggman) was the one that discovered Emerl and his purpose is more sinister in nature than it would seem.
The game takes place in 3D arenas in which the typical Sonic cast fights with 2-4 characters. Aside from normal sets of attacks, each character has Shot (projectile), Power (strong), and Set (trap) special attack they can use. Each character has their respective story, mostly centering around the mystery of Emerl. The playable fighters are Sonic the Hedgehog , Tails, Knuckles, Amy, Rouge, Shadow, Cream, Emerl, E-102, and Chaos; all but the latter two possess their own unique chapter in the Story Mode.
Sonic Battle is the only post- Game Gear handheld Sonic game to have been fully developed by Sonic Team. All other handheld Sonic games, with the exception of the Backbone-developed Sonic Rivals games, have been developed by Dimps Corporation under Sonic Team's supervision.