Valkyria Chronicles combines strategy elements of conventional tactical role playing games with real-time action sequences. The game is set in a fictitious continent reminiscent of 1930s, Europe divided in two and ruled by the Empire and the Federation. The Empire has set its sights on invading a small neutral country called Gallia, which is situated in the middle of the two great empires. The game follows a hero named Welkin and his fellow soldiers of the Federation's 7th Platoon that are fighting against the Empire, who is intent on unifying the continent under its power.

Built upon the new "CANVAS" engine, Valkyria Chronicles' ground-breaking 3D graphics resemble a watercolor painting in motion. Gameplay is centered around a new type of tactical battle concept. Known as "BLiTZ," this battle concept gives players unique freedom to strategically move around the environment and attack enemies using real-time controls.