Thwarted again by Naraku, Inuyasha, Kagome Higurashi, and their friends must continue their hunt for the few remaining Shikon Jewel shards, lest they fully form into a corrupted jewel at the hands of Naraku. But Naraku has plans of his own to acquire them, and will destroy anyone and anything standing in his way—even his own underlings. The persistent, unyielding danger posed by Naraku forces Sango and Miroku to decide what is most important to them—each other or their duty in battle. Meanwhile, Inuyasha must decide whether his heart lies with Kikyou or Kagome, before fate decides for him. Amid the race to find the shards, Inuyasha and his brother Sesshoumaru must also resolve their feud and cooperate for their final confrontation with Naraku, as it is a battle they must win in order to put a stop to his evil and cruelty once and for all.

During their quest in the feudal era to recover the shards of the miraculous Shikon Jewel, Inuyasha, Kagome Higurashi, and their friends become the target of Menoumaru Hyouga—a demon awakened by one of the Shikon fragments, now in pursuit of Inuyasha's heirloom sword Tessaiga. Following a clash between the fathers of Inuyasha and Menoumaru, the weapon is the only means to restore Menoumaru his rightful family heritage. However, upon ambushing Inuyasha, Menoumaru discovers that Tessaiga's owner alone can wield it. Determined to achieve his objective regardless, he kidnaps Kagome to force Inuyasha to use his blade and release the sealed powers of the Hyouga clan. With their dependable companions' assistance, Inuyasha and Kagome oppose Menoumaru, unaware that his sinister intentions and alarming potential will endanger not only their world but also its distant future.

Kagome Higurashi's 15th birthday takes a sudden turn when she is forcefully pulled by a demon into the old well of her family's shrine. Brought to the past, when demons were a common sight in feudal Japan, Kagome finds herself persistently hunted by these vile creatures, all yearning for an item she unknowingly carries: the Shikon Jewel, a small sphere holding extraordinary power. Amid such a predicament, Kagome encounters a half-demon boy named Inuyasha who mistakes her for Kikyou, a shrine maiden he seems to resent. Because of her resemblance to Kikyou, Inuyasha takes a violent dislike to Kagome. However, after realizing the dire circumstances they are both in, he sets aside his hostility and lends her a hand. Unfortunately, during a fight for the Shikon Jewel, the miraculous object ends up shattered into pieces and scattered across the land. Fearing the disastrous consequences of this accident, Kagome and Inuyasha set out on a challenging quest to recover the shards before they fall into the wrong hands.

Fortune smiles on Inuyasha and his allies when they finally defeat their nemesis Naraku, who has caused them unrelenting hardships. Overjoyed by the long-awaited victory, they all hurry to resume their former lives, unaware that danger still lurks around. Kanna and Kagura, two of Naraku's subordinates, make arrangements to set free a sealed demonic entity that claims to be Kaguya, the legendary Princess of the Heavens. Although preoccupied with their own endeavors, Inuyasha's group members reunite by a string of unusual coincidences involving Kanna and Kagura along with an inexplicable phenomenon of repeated full-moon nights. Upon realizing that Kaguya is behind the troubling events and that she holds a terrible power, they join forces once more to stop the disastrous fate she has planned for the world.