This idea came to me while reading another crossover story between avatar and Naruto by author Bardock91 so if you have read that this might seem slightly familiar
Chapter 1
The last airbender meets the last demon shinobi
Team avatar consisting of Aang a young 100 year old bald monk with arrows on his head and arms, Sokka a young warrior with his hair shaved on the sides and in a ponytail, and Katara Sokka's younger sister she had her bangs in two loops on the side of her head and her hair in a ponytail Momo and Appa Aang's pet flying lemur bat and flying bison were making their way to the north pole when Katara noticed that they were passing over what looked like ancient ruins. "Hey guys we should take a short break to take a look at those ruins they might have something to do with the avatars." Katara said to her friends "Alright Katara" said Aang since he was the one flying the giant bison "Appa let's take a break and land near those ruins." Aang said to his closest friend the Gaang landed and made their way to the ruins when they got there they saw words that they couldn't understand "what is this chicken scratch" asked Sokka "I can't tell" Said Aang "it looks like this tunnel leads somewhere we should follow it" said Katara the three made their way down the tunnel till they came to a door they walked in and saw something that horrified them there was a boy with black hair in black tank top what looked like a grey chest armor black pants and black boots on the side of his head was what looked like a porcelain mask and a headband with a strange symbol on his head hanging from chains with hooks going through his arms and legs. "oh spirits" said Katara "WHO ARE YOU" said a booming voice "I am Aang the avatar, these are my friends Sokka, and Katara" said Aang to the voice "Who are you" asked Sokka. "I am Faust the great spirit" said the voice "I have been guarding and rejuvenating this boy for the last five thousand years along with another human but that's for another time if you free this boy from his bounds he could help or destroy the world this boy watched the old world be destroyed and everyone he cared about die by a desperate madman those he deems unworthy he will kill and absorb all their power." spoke Faust "How do we awaken this all powerful being" asked Sokka "You must unleash your strongest attacks of all the possible elements earth, air, fire, water, lightning, blood, ice and metal" said faust. "Blood, Ice and Metal" asked Katara "yes these are three of the four sub elements lightning is the sub element of fire, blood is water, metal is earth, and ice is air, you and the avatar must hit him with a form of all these attacks" said the spirit. "How Aang and me have yet to learn full control of these abilities" said Katara. "I will guide you in your bending and give you brief knowledge of how to do this" said faust. Faust gave them the ability to use these elements only in one shot so Aang and Katara shot their most powerful attacks based on these elements at the young man the attacks were dead on and then the young man started to glow a bright red glow then nine red tendrils came from behind him and it seemed to shoot at them but then went around them and struck nine fire nation soldiers whom they hadn't noticed were behind them surprising considering the armor that they wore
Nine Minutes later
Nine minutes later the tendrils then retreated and the boy fell from his chains he then stood up and stretched out "Oh I feel so much better" the boy said as he stretched out his arms the three friends noticed that the boy's wounds were healing themselves. "How is he doing that" asked Katara "I don't know it must be some form of bending" said Aang the boy turned around "hello you three my name is Cain Kitsune" said the strange boy "I am an ancient demonic spirit from long ago who also happens to be the grandson of the moon and a man proclaimed as a god by all around him, though that was probably due to his powerful eyes" Cain muttered to himself "What was so special about this man's eyes and how can you be the grandson of the moon spirit" said Katara "my grandfather's eyes gave him the ability to manipulate the elemental chakra releases fire, earth, wind, water, lightning, sky, steel, ice, yin, yang, gravity, darkness, lava, storm, boil, dust, explosion, scorch, magnet, wood, crystal, swift and space time manipulation, it gave him the ability to read minds, summon animals and even bring back the dead and he was the one that trapped my grandmother Kaguya in the moon, Maybe that's why people saw my grandad as a god because of all these abilities. his abilities lie in the six paths techniques, the Deva path gave him power over gravity, the asura path allowed one to mechanize one's own body, the human path allows you to read minds and control over the soul, the animal path allows for summoning animals, the preta path allowed him to absorb chakra and other energies, and he could summon an entity known as the king of hell with the naraka path it's said there's a seventh path called the outer path it allowed him to preside over life and death it also summons the demonic statue of the outer path and manifests chakra chains to bind others , these abilities are distributed to six bodies with black receivers. these abilities allowed my grandfather to be known as the shinobi no kami in legend it translates to god of shinobi, also known as rikudo no kami or god of the six paths, or just rikudo sennin which means sage of the six paths." said Cain "did he have a name." asked Sokka "Yes his name was Hagoromo Otsutsuki. I have to say he lived up to his hype as the most powerful human ever seen. by using his godlike eyes he trapped my grandmother in the moon and split her chakra into my eleven family members my father and his twin sister and their ten other siblings they became known as the ten Bijuu." Cain explained "wow we didn't think anybody but the avatar could have this power do these eyes still exist." Katara asked, "yeah" asked aang "we could use that in our fight against the fire nation" said sokka "only about eighteen people have them today and only two people are actually still in this world the other sixteen are in a part of the spirit world." Cain said." who." asked Katara "myself and my apprentice Naruto Uzumaki-Senju-Namikaze-Uchiha are the only two people left with this lucky for you three instead of six paths I have nine and eight of the sixteen in the spirit world are those paths." said Cain "Can we see" said Aang "sure" said Cain.
Cain closed his eyes and a few seconds later Cain opened his one good eye which went from blue to red with four concentric rings around the pupil" "why did only your right eye change" asked Katara "I'm blind in one eye" Cain answered "How that happen" asked Katara "I got stabbed in the eye" Cain said casually. "How are you so casual about that" asked Sokka "I've had worse" Cain said Cain then bit his thumb did a few hand signs and said "summoning jutsu" then nine people appeared four girls and five boys one girl had black hair and purple eyes, a pale girl with red hair and yellow eyes with a strange gourd like object on her back, next was a girl with light skin and black hair streaked with blue and yellow eyes as well, the other was a young male with white hair and white eyes, the next was a young boy with long black hair and black eyes, the next was a boy with platinum blond hair, next was a girl with purple hair and eyes, next was a slightly dark skinned girl with brown hair and eyes and next was a boy with black hair and white eyes "these are my cousins this is Elesa the zero tailed leech demon" said Cain pointing at the girl with black hair and purple eyes, "this is Gaia the one tailed tanuki demon" he said pointing at the red head, "this is serena the two tailed cat demon" pointing at the blue haired girl, "this is Kameha the the three tailed turtle demon" pointing at the dark haired boy with white eyes, "then we have Gohan the four tailed monkey demon", "this is Anuma the five tailed horse dolphin demon", "this is Nami the six tailed slug demon", "shauna the seven tailed rhinoceros beetle demon, and Takato the eight tailed octopus-ox demon, and you already know me Cain the nine tailed fox demon" Cain finished introducing his cousins / friends. "we are all masters of the elements but are fluent in one or two specific elements Elesa is a master of darkness, Gaia is a master of earth and air, Serena is a partial master of fire, Kameha is a master of water and yin release, Gohan is a master of lava, fire, and earth, Anuma is a master of fire, water, and boil release, Nami is a master of water, Shauna is a master of air, takato is a master of water, I am a master of air, fire, and lightning". "We all get power over fire, air, lightning, earth, water, wood, ice, boil, lava, storm, dust, explosion, scorch, magnet, yin, yang, and yin-yang." Cain explained "can anyone learn these" asked aang "yes if you can master two elements then you can combine them into another element air and water make ice,water and fire make boil, earth and water make wood, lava is made by combining fire and earth, lightning and water make storm, dust comes from fire, earth and water, explosion comes from earth and lightning, scorch is fire and wind, magnet is wind and earth. Yin is the dark or shadow style and release on the spiritual energy of chakra, yang or light style is the physical side of of chakra when combine it makes the yin-yang release this forms the basics of chakra and its control", explained Cain "so only aang could learn it" asked Sokka "my cousin didn't say that" said Gohan "anybody can learn to manipulate chakra and you can manipulate all the elements but it takes a while very few have ever mastered all the elements we all can use them but haven't mastered it yet" finished Elesa "and we have been alive for a few thousand years". "Now onto the big question why did you guys awaken me" asked Cain "we are traveling trying to teach Aang the last three elements water, earth, and fire we've also started a rebellion against the fire nation can you all help him train" asked Katara, we all started thinking "here's fair warning our training is difficult and we can extend it to all three of you we can train aang in all the elements we can train you katara in water bending and you sokka we can train you in taijutsu or just martial arts, so can you all handle it" Cain asked. "We can said Aang alright then let's head out of here it's starting to get depressing" said Cain " HOLD ON CAIN" said the familiar booming voice of faust "what is it Faust" asked Cain "I can't have you going out back in the world with only one eye you will need all your power after all I will tell you why soon" said Faust as he touched Cain's dead eye and healed it. "I can see again" Cain said "yes you can cuz so turn around so we can see your two shining blue eyes" said Nami Cain did and the demons smiled at seeing their friend happy to have access to both eyes again.