Kagome Higurashi is a modern day young girl who lives with her family by the old Higure shrine. Unbeknownst to Kagome, she is the reincarnation of priestess Kikyo and posseses the "Jewel of Four Souls" (the Shikon jewel). One ill-fated day, Kagome locates an ancient well near her home and is abruptly transported through the well and into a feudal Japan, inhabited by demons. There, she encounters Inuyasha, son of a powerful demon father and a human mother, who is pinned to a tree by an enchanted arrow.
Hakudoshi is scheming to take Naraku's place. He steals Kagome's Shikon Jewel shards and entices Kagura to betray Naraku.
Upon healing her wounds inflicted by Naraku, using Midoriko's soul, Kikyo runs into Inuyasha again and reveals the secret to destroying Naraku.
It is the day of the annual Fox Demon Exam at the Demon Inn. Miroku and his friends get stuck taking the tests. Shippo hopes to be promoted in rank for playfully getting revenge on Inuyasha.
The swordsmith Toshu forges a demon-blade using one of Ryujin's scales, and the Dakki was born. Meanwhile, every time Inuyasha tries to attack, he is undermined by demonic energy.
The Tetsusaiga has attained the power of the dragon scales. In order to be able to quickly use the demonic power well, Inuyasha has no choice but to go through training.
Inuyasha and Koga arrive at the scene of Moryomaru and Naraku's fight. But Moryomaru, who wants his Shikon shards, catches Koga.
Kikyo has been contaminated by Naraku's spider web. In order to save her, Inuyasha and Kagome need the bowstring kept in Mount Azusa's mausoleum.
Kikyo attempts to purify Naraku and his Shikon shards along with Midoriko's will that controls the shards in Koga's legs.
Sesshomaru visits his mother to ask how he can expand the Tenseiga's Meido Zangetsuha technique. In response, his mother uses the Meido Stone that Sesshomaru's father gave her.
The Flower Prince is a demon that feasts on saddened or anguished hearts. Dazzled by the flower's fragrance, Inuyasha becomes entangled in a fake dream.
The Mirror Demon steals Tetsusaiga's demonic energy. Inuyasha counterattacks despite enduring some fierce blows, but all of his attacks aimed at the Mirror Demon end up being taken by Kanna.
During a new moon, Sango and Miroku face off against a "Bone-collecting" demon. During the battle, Miroku is forced to use his wind tunnel twice, resulting in his being poisoned. To protect him, Sango coats her hiraikotsu in poison and uses it to destroy the demon, destroying her weapon in the process.
The demon Shishinki approaches Sesshomaru for a fight, having been defeated by Sesshomaru's father long ago. To Sesshomaru's surprise, Shishinki attacks him using a complete Meido Zangetsuha and claims Sesshomaru's father stole the technique from him. Sesshomaru attacks with his Meido, but Shishinki's absorbs it.
Sesshomaru visits Totosai, who confirms that his father gave him Tenseiga so Sesshomaru could perfect the Meido Zangetsuha before he planned Inu Yasha to reabsorb Tenseiga back into the Tetsusaiga.
Seshomaru challanges Inuyasha in order to see if Inuyasha is worth having Tetsusaiga. He uses a fragment of Kanna's mirror to create a replica of the sword from Tenseiga.
The priestess Hitomiko loses her life at Naraku's hands, but she is resurrected and locks Kagome within a barrier. Then, the true spiritual power of Mount Azusa's bow reveals itself!
Inuyasha's group returns to Kaede's village to tell her of Kikyo's death. As they talk, she states that Kagome's power was probably sealed by Magatsuhi, the evil will of the Shikon Jewel that did it out of fear of Kagome's powers.
Kohaku remains unconscious after being stared down by Magatsuhi, the evil will. Kagome is worried, but she has to buckle down and study for her entrance exams, so she decides to return home.
Sesshomaru chases after the evil will, Magatsuhi. But it's only part of a trap set up by Byakuya of the Dreams. Magatsuhi finds Kohaku lying unconscious, and he tries to deliver his Shikon shard to Naraku.
Kohaku successfully drives Magatsuhi out of his body just as Sesshomaru arrives, who manages to cut Magatsuhi in half, destroying part of him. Naraku then tries to take Kohaku's shard himself, but Sesshomaru attacks with his Bakusaiga, which causes Naraku's body to explode.
Inuyasha's group leave to defeat Naraku, leaving Shippo behind. As they find Naraku and Byakuya in a cloud of miasma, they see Sesshomaru enter Naraku's body in search of Rin. As Inuyasha's group enters, Miroku pauses to propose to Sango.
Inuyasha's heart is devoured by the Shikon Jewel's poison, and he turns into his demon form helpless as the darkness in his heart takes control of him.
Kagome's spiritual powers are restored, and divine light is revived in Naraku's Shikon Jewel. However, Naraku uses this as a decoy to lure Sango into his trap.
Naraku has been living as a demon despite having a human heart. While fighting him, Kagome asks about his true wish.
Naraku heads for the Bone Eater's Well and vanishes! Before disappearing, Naraku makes his last wish for Kagome, injured at the hands of Byakuya, to be swallowed into Meido, the Path to the Underworld.
When the last person to obtain the Shikon Jewel makes the one correct wish, the jewel will be purified and disappear entirely from this world. The long journey of Inuyasha and his companions comes to end and thus concludes this Feudal Fairy Tale.