Unlike Tales of Xillia 2, Tales of Zestiria returns to a normal medieval high-fantasy setting. On the continent of Greenwood, there are two main powers, namely the Kingdom of Highland and the Empire of Lowlance, fighting for rule and supremacy. There are multiple religious beliefs in Greenwood, but the people all have their beliefs in the Seraphim, believing in their existence despite not having seen them themselves. This is because there are people who appear from time to time and can communicate with the Seraphim. These people are able to borrow the Divine's power and are called priests.

A long time passed, and deep within a forest called the Divine Forest lies something that resembles a utopia, where humans and the Seraphim can live together. Here, other humans cannot enter, and the "impurity" that has been spreading throughout the world does not affect the place. The story begins when Sorey, a young man forbidden to go outside of his village deep within the forest, meets Princess Alisha, who serves her country as a knight, in an ancient ruin, when it collapses. This young man is accompanied by Mikleo, a Seraph and Sorey's childhood friend.