Dark Souls is a tale that is revealed through subtle hints and environmental storytelling. The game takes place in a dark, decaying world called Lordran, where the player takes on the role of an undead warrior tasked with fulfilling a prophecy to link the fire. It is here that the player soon realizes that the world is not what it once was—negligent rules have caused a climate disaster, which the player needs to fix.
The world of Lordran started out as a flourishing landscape with great kindgoms and gods—those who held lord souls—but over time the gods grew complacent and the world began to go through a catstrophic transformation with demons, hollows and souless. One god, Gwyn - The Lord of Sunlight, attempted to rekindle the First Flame, the source of their power and the light of the world, but his effort was in vain. The flame began to fade, and with it, the world of Lordran began to fall into more of a darkness.
To understand why this matters, it is imperative to understand what the flame represents. Before we spoke of this ultimate life source, there existed a natural world filled with giant ancient dragons. These dragons were the gods of the natural world and can be viewed as the natural order. Soon, however, humanity received "the first flame". "And with fire came disparity, heat and cold, life and death, and, of course, light and dark". Specific beings found a specific fire called "lord souls". To understand their importance, consider that souls are the life force of every living thing. These souls made them more powerful, stronger, etc.
Soon, the new lords were able to rid the dragons with their new technology and start an age of fire in Lordran, fuelled by the power of the first flame. However, as mentioned previously, the lords soon became complacent with their power and made some poor choices. One such person, the Witch of Izalith, noticed how the fire that fueled their powers was fading, eroding what once was. To remedy this, she tried to recreate a new flame. However, nature taught her she couldn't play God, and soon demons spread throughout the world.
The flame continued to fade, and Lordran got worse and worse. For years, no one did anything. Finally, one brave soul, Gwyn, the lord of sunlight and ruler of Lordran, decided to sacrifice himself to the flame to "feed it". In such a process, he rekindled the flame and miraculously made it out alive. One who survives this process of rekindling is called a "Lord of Cinder" and comes out of the process severely damaged and a husk of what they once were. However, this solution was only temporary. Soon, the flame faded again.
As the flame faded, undead of Lordran began to rise. These were people who had passed away but were cursed with an inability to truly die, instead respawning each time they perished. This affliction is called the 'undead curse," which afflicts those with the dark sign. They lose all their "souls" and go hollow, becoming virtually insane. The undead were feared by the living, who saw them as an affront to the natural order. They collected them and put them in an undead asylum - removed from Lordran.
The player character is one of these undead who must fulfill a prophecy long foretold where an undead warrior would one day come along and rekindle the flame that is afflicting this dwindling world. In the end, it is up to the player to sacrifice themselves and keep the cycle going (generationally not solving the problem) or let the fire fade out and see what a new "age of darkness" would look like.
The player's journey through Lordran is one of self-discovery and transformation as they gradually come to understand the true nature of the world they inhabit and the role they must play in its ultimate fate.