In a flashback, before Ban had become a member of the Seven Deadly Sins, he was a bandit who sought the Fountain of Youth, a liquid sap following from the Fairy King's Forest's Sacred Tree, which sustains the entire forest. Although initially repeatedly thwarted by Elaine, the Holy Maiden and Protector of the Fountain of Youth, she soon realises that Ban is different from other humans that attempt to drink from the Fountain due to greed, who instead simply wants to live long enough for something good in his life to happen. In the present, Meliodas, Elizabeth, Hawk, Diane and Ban make plans to go to the Capital of the Dead, catching a glimpse of King, whom Ban does not recognise at first due to his tremendous loss of weight. With help from two siblings, the six, trailed by King, find the entrance of the Capital of the Dead entrenched in a field of flowers, accessible only by the living who share a priceless memory of the dead.

Ban's memory of Elaine unlocks the door, allowing them to enter the Capital of the Dead, an empty world surrounded by neon green crystals. Glimpsing Elaine, Ban runs towards her but is petrified by King in the process, who seeks revenge on him after overhearing rumours that Elaine's death was caused by him, and revealing that she was his younger sister. Ban has another flashback where he and Elaine grew close and fell in love, but the two were severely injured while confronting a red demon rampaging the Fairy King's Forest. Elaine then sacrificed her life by ingesting the Fountain of Youth and feeding its power to him through a kiss, allowing Ban to attain immortality and kill the red demon. In the present, a Holy Knight named Guila enters the Capital of the Dead, battling Meliodas and Diane while Elizabeth and Hawk run away to safety. Elaine, first unseen to King, releases Ban from petrification with a kiss, allowing him to join Meliodas and Diane in the battle against Guila, while Elaine tells King to understand Ban and save him. After being informed by Elizabeth and Hawk about the ongoing battle, King executes a surprise attack from behind through Ban to strike Guila.

King overpowers and single-handedly defeats Guila using his Sacred Treasure, the Spirit Spear Chastiefol. As Meliodas, Elizabeth, Hawk, Diane, Ban and King return to the village, King tells the others that the Sacred Treasures of the Seven Deadly Sins unlocks each of their full potential in combat. However, Meliodas sold his, Diane lost hers and Ban got his stolen. Meliodas, Ban and King head to the Merchant Town Vaizel during the annual fighting festival, in which the grand prize happens to be Diane's Sacred Treasure, the War Hammer Gideon. Meanwhile, Great Holy Knight Hendrickson summons Jericho and Twigo underground, offering them blood from the corpse of a red demon as a means of enhancing their strength. Twigo explodes after drinking the blood, but Jericho manages to survive the excruciating experience.

Meliodas and Ban engage in a fierce fight that shakes the ground beneath them, equally matched due to their incredible strength and agility. However, Meliodas grabs onto Ban's wrist and blasts him out of the ring, thereby winning the round. The first round of the semifinals is Diane versus Howzer, in which Howzer goes all out with his windy punches, but Diane does a body slam on Howzer and wins the round. The second round is Cain versus Meliodas, in which Cain believes that Meliodas betrayed the kingdom in the past. When Meliodas says that he did not betray the kingdom, Cain trusts Meliodas and forfeits the round. The round of the finals is Diane versus Meliodas, while Guila and Jericho are making their way towards Vaizel.

Guila and Jericho interrupt the tournament and cause terror upon the merchant town. King subdues Guila and Jericho after Meliodas and Ban are defeated by them, but King is later overwhelmed by Holy Knight Helbram, who was disguised as tournament referee Love Helm. Meanwhile, Elizabeth returns to her normal size and stumbles upon her elder sister Veronica Liones, who scolds Elizabeth for being involved with Meliodas. Veronica then traps Meliodas inside Goddess Amber, a stone specifically made to seal demonic beings. Elizabeth runs away with Meliodas's sword and Goddess Amber, while Griamore temporarily restrains Guila and Jericho. Veronica catches up to Elizabeth and shields her from an explosion made by Guila, which causes Veronica to pass away. When Elizabeth calls out for Meliodas, he emerges from within Goddess Amber with a darker side to him.

With his true power finally shown, Meliodas clashes with Helbram, who takes note on how Meliodas hones his dark abilities. After managing to defeat Meliodas, Helbram steals Meliodas's sword. Ban takes Elizabeth, Hawk and King to safety, while Diane returns to her normal size and wields Gideon with attacks that crumble the earth, forcing Helbram to retreat with Guila and Jericho in tow. Elizabeth embraces Meliodas after he is rescued by Diane, later lamenting the death of Veronica. Ban and King express their motives behind taking back the kingdom. With his sword now stolen, Meliodas vows to end the ongoing war once and for all.

News about several sightings of an Armor Giant somewhere in Ordan Forest reaches Helbram, who quickly sends Dawn Roar, an elite group of Holy Knights, to search for the Armor Giant. Meanwhile, Guila visits her younger brother Zeal, and she later kills three thugs who bullied him for his spare change. Meliodas and his friends split up in the nearby village. Elizabeth and Hawk encounter a boy named Alan, who is looking for some glue to repair armor. Upon hearing the low growls that echo in the forest, Meliodas, Ban and King find the Armor Giant being surrounded by Dawn Roar, but Meliodas, Ban and King are no match against Dawn Roar. Just as it seems that the Armor Giant is about to be slain, Alan intercepts and reveals himself as Gowther, the Goat's Sin of Lust.

Gowther gives the head of the Armor Giant to the members of Dawn Roar in order to convince them to withdraw from battle. However, the demon breaks through the armor and attacks Meliodas, Ban, King and Gowther. Meliodas lowers his guard upon noticing a Holy Knight merged into the demon's chest, but Gowther uses his Sacred Treasure, the Twin Bow Herritt, to stop the demon. Meanwhile, Cain visits Elizabeth in the Boar Hat, where he tells her the story of Liz, a knight from an enemy kingdom who became Meliodas's past lover after he saved her from being sentenced to death. Ban gouges out the heart of the Holy Knight, recognized as Guila's father Dale, yet the demon still remains alive. Elizabeth rushes to Meliodas and gives him Liz's sword left behind, which allows him to destroy the demon. It is realized that Dale was one of Hendrickson's failed demon experiments.

Gowther is welcomed by the others into their group, but he soon finds out the true secrets behind them by delving deep into their memories and emotions. Meanwhile, Hendrickson and Helbram have the hilt of Meliodas's sword in possession, in which they plan to use it as a fragment of a ritual relic, known as the Coffin of Eternal Darkness, to resurrect the red demon race as a means to start a holy war. At the Boar Hat, Holy Knight Vivian suddenly appears and kidnaps Elizabeth and Hawk. Diane throws Meliodas, Ban and Gowther toward the Kingdom of Liones, where the three are bombarded by an army of Holy Knights on the north side of the castle. However, Arthur Pendragon, the young king of Camelot, has approached the south side of the castle with his own army.

Hendrickson tries to convince Arthur to leave the castle, but to no avail. Instead, Hendrickson escorts Arthur inside the castle and suddenly engages him in battle. Meanwhile, Elizabeth and Hawk are teleported inside the dungeon of the castle, and they try to find a way out. Meliodas, Ban and Gowther manage to defeat the army and sneak inside a town of the kingdom, while King summons his black hound Oslow to use its mouth to teleport Diane inside the castle. However, Diane is attacked by Guila, Jericho, Gilthunder, Howzer, Helbram and Great Holy Knight Dreyfus. Diane tries to defend herself, but Dreyfus overpowers her with an attack that sends her crashing onto the town streets. After Diane wander the streets and protects Zeal from being crushed by a falling building, both Howzer and Guila switch sides to defend Diane.

The combined powers of Howzer and Guila have little to no effect. When Dreyfus attacks Guila, Gowther saves Guila in the nick of time and faces Dreyfus alone. Meanwhile, Elizabeth and Hawk encounter Margaret Liones, Elizabeth's eldest sister, in a cell. Vivian appears, teleporting Hawk elsewhere, knocking Elizabeth unconscious and releasing Margaret from her cell. Gowther traps Dreyfus in a nightmare, but Dreyfus somehow snaps out of it and pierces Gowther in the chest. Once a heavily injured Dreyfus leaves with Gilthunder, Helbram attempts to finish Diane off, but King appears and stops Helbram, who reveals himself as a fairy and King's former best friend. Helbram uses his magical tree roots to restrain King and inflict brutal lashes on Diane. However, King uses Chastifol to shield Diane from getting hurt. King says that he is fulfilling a promise that he made seven hundred years ago.

Ban explores the catacombs under the city. Merlin and the other sins go to the chamber where the king Baltra and Elizabeth are being held captive. Dreyfus has a confession.

Ban attempts to kill Meliodas, but is stopped by Hawk. Meliodas and the sins corner Hendriksen and prepare to take him down.

Hendrickson unveils the source of his power, the corpse of a red demon, which is the same one that Ban slayed in the Fairy King's Forest long ago. After Ban pummels Hendrickson through the ground, Meliodas, Ban, King and Gowther jump down the hole to a cave, where Hendrickson injects himself with the blood from the corpse of a gray demon to acquire even more power. A sudden burst of energy from Hendrickson sends the four of them back above ground, where Hendrickson easily overpowers all of his opponents despite all of their efforts. With Meliodas left standing and protecting Elizabeth, Hendrickson casts a large dark blast, but Hawk sacrifices himself in order to save the two of them. Shocked of losing her dear friend, Elizabeth awakens her dormant powers that repels Hendrickson and heals everyone else. However, Hendrickson survives and still has strength left in him to fight.

The Seven Deadly Sins and the Holy Knights all combine forces in an attempt to defeat Hendrickson. Meliodas, given support from his friends and allies, uses his ultimate technique to finish Hendrickson off. When Bartra appears with Merlin, he commands the Holy Knights to restore the kingdom and preserve its people as their "punishment" for starting a holy war. Bartra then thanks the Seven Deadly Sins for saving the kingdom and protecting Elizabeth. Hawk is revived as a piglet, much to a surprise. Things return to normal inside the kingdom, and a festival is held at night. The next day, Elizabeth joins Meliodas, Hawk, Diane, Ban, King, Gowther and Merlin in finding the last member of the Seven Deadly Sins, Escanor, the Lion's Sin of Pride.

With Fraudrin's manipulation of Hendrickson, the Ten Commandments return to the physical realm. King follows Ban to the Fairy King's Forest.

Diane confronts Gowther after he manipulates Guila and Zeal's memories. With the return of the Demon Clan, new threats descend upon allied clans.