After a meteor hits Earth, traitor forces have (for all intents and purposes) taken over, and the people are suffering. In the chaos, a boy named Tetsuro Daiba, who had lost his parents in the meteor hit, is paid a visit by Mello, a mysterious woman appearing in a bright light. When Daiba comes to, he finds itself in a spaceship infirmary under observation. Stealing a fighter that he didn't know how to pilot (until he tried it), he breaks out, flying like a total pro.

According to an ancient Japanese legend, mermaid flesh may grant immortality if eaten. However, there is a much greater chance that consumption will lead to death or transformation into a damned creature known as a Lost Soul (or Deformed Ones in the English dub). Mermaid Saga tells the tale of Yuta, an immortal who has been alive for five hundred years, who is wandering across Japan searching for a cure and meeting others whose lives have also been ruined by mermaid flesh in the process.