Read the main story of the game here.
I had a lot of stuff planned for the story. But basically, you chase the Demon around Andora while he is trying to find all the pieces of the Tear of Neriah, because he wants the godlike power inside it. At one point in the game you read a book and you see a white city being destroyed (by the goddess Neriah); that was the Sundarmis tribe, they managed to harness the power of the Tear of Neriah. The player and the Golden Demon were part of that mountain tribe, and are actually brothers and the last two surviving members of that tribe. The Demon's real name is Sorathis and he protected you when the city was destroyed. He became so angry that the Gods destroyed his home that he left you and went on a journey into the mountain to pray to the God of Death to help him take vengeance on Neriah, in exchange for his body and soul. He stayed there for centuries, meditating and learning everything about the dark arts. His mind became corrupted and his body tainted. Sorathis channels the God of Death and has a golden mask fused to his face in his image.
When your brother left you, you wander out on your own onto the world. You restart your life as a rogue wanderer. Many years later, Sorathis (who would be known as the Golden Demon) descends from the mountains and starts attacking villages. You learn of this and meet him in a forest where he blasts you with magic, making you faint and lose your memory. But you survive and wake up a day later, starting the events of the game.
I had plans to feature at least two more cities where you walk around trying to figure out where the Demon might be. A female felken crossbow-wielding warrior joins your party. She is chasing the Demon for destroying her home village.
The whole reason the Golden Demon is roaming the lands is because he is searching for the pieces of the Tear of Neriah. If all pieces are fused together by a Sundarmis-born (which you both are) the holder will be infused with the power of the goddess Neriah.
In the end you find him in an abandoned castle where you and the Demon fight. Caleb sacrifices his life to help you and you kill the Demon with the Omniflash limit break. The last blow of the Omniflash attack makes the Demon's mask fall off and you see your older brother's scarred face and you learn of his true identity.
He dies and the story ends. You build a statue of Caleb in Bavelock in honor of his sacrifice. The end...?