A thousand years ago, a young Black Magician named Tar valiantly fought the demon lord Thornahuun, who was revealed to be his own father. However, Thornahuun managed to possess his son's soul and corrupt it. Tar declared himself Lord Tarbos and brought terror to the land of Lyramion, before being locked away in a secure prison on the world's red moon. Now, a sorcerer named Marmion is trying to release him, with the intention of spreading horror through the land. A lone adventurer from the town of Twinlake must gather thirteen pieces of a powerful artifact known as Amberstar to prevent that from happening.

Amberstar is a role-playing game which uses a top-down view for overworld travel and most indoor locations, and switches to a first-person pseudo-3D perspective when exploring cities and dungeons. Initially the player creates a single protagonist with randomly assigned attributes and no class designation. During the course of the game, additional characters (up to six active party members) can be found in different cities and other locations and recruited. Some of these characters already belong to established classes and come with their own abilities. Guilds of various classes (fighter, paladin, ranger, mage, monk, and thief) can be visited, where the protagonist and his class-less companions (if any) can be promoted. Choice of classes affects attributes, character growth, imposes equipment restrictions, etc. When leveling up, characters can train in specific locations, increasing attributes of the player's choice.