The game is set in the fantasy world of Reveria, which is made of the plains and mountains that center and surround the three lands of Castele, Port Puerto, and Al Maajik.

Its rulers, King Erik of Castele, Damien of Al Maajik, and Olivia of Port Puerto spend their days ruling over their citizens and guiding them in their choice of the 12 available Life paths.

One day this peaceful state is shattered when a strange purple meteorite falls into the house of the player, setting off a chain of events foretold in an ancient prophecy involving Reveria's goddess and the moon Lunares.

The player is asked by King Erik of the land of Castele to investigate these strange occurrences, as the meteorites, later dubbed Doomstones by the world's inhabitants, have the ability to fill creatures with dark, destructive energy.

As the game progresses, the butterfly reveals that her real name and form is Yuelia, the daughter of Celestia, whom the people of Reveria worship as the Life Goddess.

[7] As the player masters each Life class they gain the ability to more easily produce and access materials on their own, as opposed to purchasing them via a storefront.

"[14] Roger Hargreaves of Metro gave it five out of ten and called it "A fun mix of influences and career paths, but the game doesn't make being a mercenary or magician entertaining enough – let alone a tailor or woodcutter.

"[15] Jed Pressgrove of Slant Magazine gave it one-and-a-half stars out of five, saying, "Some will try to excuse this nonsense by claiming the game is for kids, but this cynical explanation implies we live in an age where we should lie to everyone, including our children, about what 'adventure' entails.

In April 2015, Level-5 revealed Fantasy Life 2: Two Moons and the Village of God, originally set for release on Android and iOS devices in 2016.

[21][22] The game was later renamed Fantasy Life Online, and suffered numerous delays over a period of three years, which pushed its release back to July 23, 2018, where it garnered over two million downloads in Japan within two weeks.