The story begins on a planet far from the Milky way galaxy, in a planet called Xochimilcia, (based on the municipality, Xochimilco) a planet of life and water, inhabited by beings known as Axolotians, sentient species of aliens who live in peace and equality. Gabriel, a teenage mid 20 aged axolotian who plays a lot of videogames, including Mario, Sonic, Kirby, Spyro and many more. He lives happily with his family, his father Abel, a rocket scientist and alchemist, his mother Zuria, a history teacher and little sister Yeya. Gabriel went to visit his best friends Tenoch, Ezequiel and Maya, who Gabriel has a secret crush on, so the group can go to the Ceremony of the Sun and Moon.
But after the celebration , there was an attack, a coup d'Etat made by Tizoc, the rogue admiral of the Axolotian military, he seized to take control of the planet. The King and Queen of Xochimilcia ordered the evacuation of the planet for the inhabitants living there. On his way to his home, Gabriel is told by his father to find his mother and sister on the evacuation center. Gabriel went on a hurry to the capsules only to confront Acayo, his jealous older brother, the two brothers dueld, and ended resulting Gabriel scarring his former brother in his left eye, also blinding it, before escaping to the capsules. He made it to the capsules and saw his mother and sister and entered the capsules alongside his friends.
Tizoc then confronted his former friend Abel to join his quest for power, but Abel refused, the two former friends fought, stabbing Abel in the chest in the process, killing him. Xochimilcia, now ruled by the tyrant admiral, recruited a wounded Acayo, with dark robes, and a plasma sword, and a helmet to hide his scar. Tizoc then reunited some of the deadliest bounty hunters and assassins to capture Gabriel, his family and friends.
On space, the capsules were separated from the ship, Gabriel went to the planet Smashtopolis, separated from his family and friends. Gabriel then opened his capsule, only for him to realize he is in another planet.
Then, a group of cyclopses, drows, trolls and even greebles captured the dragon Spyro to an arena located far from his homeworld, Battlebrawl Island. The arena is hosted by Count Moneybone. Spyro then defeated monsters such as Bubba Greebs, Dragon hunters, and Baa-barians. Moneybone then used his secret weapon, Kirby to defeat the young dragon once and for all. Before finishing off the dragon, a fleet of airships owned by Bowser, attacked the Island and killed many spectators, destroying Moneybone's body in the process, leaving his skull intact without a body, saying "crap, I need another body".
Bowser summoned his minions to attack and capture anyone from the arena, later the Koopa turned his attention to Spyro and Kirby, ordering a rebuilt Megaleg to capture both so he can find the locations of the Smash Balls, much to Spyro's confusion.
Megaleg captured Kirby but missed to catch Spyro, once intending to leave, he had a change of heart by destroying Megaleg and saving Kirby, much to Bowser's frustration and proclaimed that he'll be back to hunt them down.
Kirby thanked Spyro for saving him, later the two bonded. He summoned the Warp Star to find someone who can help Spyro, only to be ambushed by the Halberd owned by Meta Knight, the two were separated on different locations.
Spyro landed on the Mushroom Kingdom, where he accidentally scared a Toad, alerting Mario of the dragon. Spyro tried to calm the situation, claiming that it was misunderstanding, and Mario believed him, he took to see Princess Peach and Toadstool, he told them that he seeks help to find his friend, Mario agreed to find his friend and set out to an adventure.
Meanwhile Kirby is found in Mobius, where he encountered Sonic the Hedgehog, Kirby told him that he seeks to find his friend elsewhere on this place, Sonic agreed to help Kirby finding his friend, so the two groups set on a quest to find what Spyro and Kirby seek for.
They later traveled to Yoshi's Island where Mario and Spyro saw a burning capsule, they encountered intruders, (unbeknownst to them the intruders are Sonic and Kirby) Mario and Spyro attacked but stopped upon learning that it was Sonic and Kirby, Mario and Sonic started dueling each other only for Gabriel to stop the fight between the two. Gabriel gasped out of amazement and joy that he met with the characters he played in his video games on his planet, he introduces himself to the group, and explains about how did he got here, much to the group's understanding his situation.
Later, a strange blade made of beskar almost stabbed Kirby only for Spyro blocking the kill, the owner revealed to be a reptilen bounty hunter named Tovar, he was hired by Admiral Tizoc to capture Gabriel and his family and friends alive. The group then helped Gabriel defeat the reptilen, Sonic contacted Tails to rescue him and the gang from Tovar's grasp, Tails said that he is coming, Sonic later entertained Tovar long enough to Gabriel knock him out unconscious. Tails arrived to pick up the gang.
The group then arrived to Peach's castle with Luigi present here as well as Yoshi, Spyro intends to leave the group, including Kirby because of his situation as well, before leaving, he mentioned about Bowser and his quest for the Smash Balls, much to their shock. Mario then explained about Bowser and Toadstool informs him about the story about the Smash Balls. Gabriel also heard stories about the Smash Balls and a weapon made by ancient axolotian warriors named the Sword of Sanctuary, and theorizes that it is located somewhere on the planet.
The group now embarked on a new quest to find the Sword of Sanctuary and the Smash Balls to defeat Bowser and Admiral Tizoc, once and for all. They went to the Cascade kingdom via the the Odyssey, unbeknownst to the group someone was seeing them and growled.
Meanwhile at Xochimilcia, Admiral Tizoc summoned Acayo with Tovar brought here as well. With Tovar explaining his failed attempt to capture Gabriel, he mentioned about Mario, Sonic, Spyro and Kirby, which he confessed that Kirby is "kinda plushy and cuddly". Tizoc has Acayo to execute the reptilen bounty hunter for his failure, later ordered him to travel to Smashtopolis to find Gabriel and his family and friends.
After Arriving at the Cascade Kingdom, they went into groups to search for any smash ball, Luigi, Tails and Yoshi to the caves, Mario alongside Cappy, Gabriel and Sonic to the ancient wall and Spyro and Kirby to the Top of the Big Stump. When Luigi's group entered the caves, the shadowy being arrived and started growling.
Meanwhile, at the Top of the Big Stump, Spyro and Kirby have a discussion about the reason why he wants to leave, Spyro replied that his situation is unthinkable, proclaiming that his enemy is far dangerous and worse than Admiral Tizoc. Kirby reminded Spyro that they were a team, Spyro now coming to his senses proclaims that he will explain his situation later as they got Smash Balls to collect. Unbeknownst to them, someone heard the conversation and found the Smash Balls interesting.
At the caves, they found a T-Rex guarding a Smash Ball and Yoshi catch it with his tongue, only for the shadowy creature to ambush them by kicking Luigi's back with a strong kick, also sending him flying, the creature revealing to be Raijon, an Oni from Spyro's homeworld. The Oni warrior then started to fight against Yoshi and Tails.
As Mario alongside Cappy, Sonic and Gabriel went to the Ancient Wall, they encountered Baby Luma, whom Mario recognizes from his adventures in the Galaxy. As Luigi crashed by the group's position, a terrified Luigi explained about a "black skinned monster with horns", definitely not friendly, much to the group's shock, they later decided to help Tails and Yoshi.
Meanwhile, Spyro and Kirby arrived at the Top of the Big Stump where they see a ? block containg a Smash Ball. Kirby catch it only to be stolen by a thief named Nabbit, who proclaims that the Smash Ball is his, Spyro spits a fireball at Nabbit, but the thief reflects it with a cape swipe, Kirby on the other hand, vacuums Nabbit and spit him by sending him away.
As the pair retrieved the Smash Ball, Yoshi and Tails were beaten up and hurt by Raijon, which Spyro makes an angry growl. Raijon mocking Spyro's new alliance with a pink puffball, by stepping on Yoshi's back, he took the Smash Ball from his mouth and gazed at the young dragon. Spyro exclaimed that he will pay for what he had done to his homeworld and friends, which the demon replied that they were weak and stupid, that it was a necessary sacrifice for the return of the Oni.
Before Raijon can turn Spyro and Kirby into dust, an airwing owned by Falco Lombardi fired at the demon, which took little damage. Raijon then disappears via smoke, not before telling Spyro that he will return, one day or another. Mario and his group returned, only to see Tails and Yoshi wounded, Falco took Tails and Yoshi to his airwing and flew to the Mushroom Kingdom alongside the Odyssey.
Back at his headquarters, Bowser speaks with Doctor Eggman and discusses about the secret Project he is being working on, only for the Doctor replying that is almost complete, only three minutes for the project to end, which is a anthropomorphic Jackal named Infinite.
Back at the Mushroom Kingdom, while Peach and the toads are healing Yoshi and Tails, Spyro was in the Castle's Garden, while Kirby and Baby Luma are playing around, he was looking at the fountain, feeling regretful and sorrowful, he was visited by Gabriel, who looks at Spyro, sensing that his mind is at his situation yet. Spyro told the axolotian that is time to tell everyone the truth. Gabriel asked if he can guess, which Spyro replied he can. First he guessed that he is not strong enough to defend his homeworld, which Spyro confirms it, later he guessed that nobody likes him, which Spyro denies it, then he guessed that his girlfriend left him, which Spyro denies it as well, and finally guessed that Spyro's homeworld is gone, which the dragon also confirmed.
Much to Gabriel's shock and amazement, screamed as it echoes the whole kingdom. Spyro slaps Gabriel in the face to shush his scream, but reveals that his homeworld was indeed destroyed. Everybody from the castle came and confronted Spyro for keeping his secret for so long, Spyro on the other hand, reveals his past and the real reason why he intended to leave them in the first place.
His homeworld, the Dragon Realms and Skylands are the most beautiful places anyone could ever know, he was a member of a group of good monsters named Skylanders, they defended their homeworld from Kaos, The Doom Raiders, Ripto, Gnasty Gnorc, and many more. One day Kaos was reading a book about the Oni and Dragons, he found the skeletal remains of a deceased Oni, he then took the remains in order to resurrect the creature so he can be his new soldier in order to conquer Skylands as his emperor. With a piece of petrified darkness, the Oni known as Raijon reawakened, the dark portal master later ordered Raijon to bow to him as his new master, but Raijon mocked him, proclaiming that Kaos was very weak because he is powerless amd that no inferior being like him can control him, before killing Kaos and destroying his fortress in the process.
Spyro caught the explosion, he went to see the destroyed fortress only for Spyro find Kaos' disintegrated body. Spyro then flew to Skylands only to find his friends, Gill Grunt, Trigger Happy, Stealth Elf, the Giants, the Swap Force, Trap team, superchargers and senseis, all dead, as well as Flynn, Callie, Hugo, Buzz, Sharpfin, Tessa and Mags.
He went to the Artisans and found Elora, Argus, Dubin, Astor, Lindar, Bentley, Sgt. Byrd, Sheila, Agent 9, Hunter and the Professor dropped dead by the demon like his Skylander comrades. By the time he heard Cynder's scream from the Artisan Tower, he rushed only to witness the love of his life killed by the monstrous demon. Spyro, saddened for his losses, he awakened an anger never felt before, with the desire to kill Raijon.
Spyro then went to the Skylander Academy were he finds Raijon absorbing the power of the Core of Light. Spyro later confronted Raijon and fought, almost gaining the upper hand but gets awfully beaten. Before Raijon can make the killing blow on Spyro, Nestor and Sparx, saved Spyro's life, they went to the portals, Nestor stays behind to give Spyro and Sparx time to escape, as the portal closes, Spyro can only glimpse Nestor facing Raijon, only for Raijon to stab him on Nestor's chest.
Sparx and Spyro got separated by the time there were to rifts, Spyro landed on what it is Smashtopolis, later he was captured by Count Moneybone's goons and then... well, they know what comes next.
As Spyro finishes his story, everyone as well as Yoshi and Tails felt sad and sorry for Spyro has been through, as Mario, Sonic, Gabriel, Kirby, Baby Luma and Luigi proclaim that they will defeat Raijon as long as they had each other. The vowed to search the Smash Balls and the Sword of Sanctuary, find Gabriel's family and friends, search for Sparx and defeat Raijon and Admiral Tizoc. As they put their hands on the Center, they're now calling themselves, the Smash Fighters.
Meanwhile at space, Acayo led a fleet of Admiral Tizoc's troops to hunt down Gabriel as they are setting course to Smashtopolis.