The player assumes the role of John Blackthorne, Pilot-Major of the Dutch trading ship Erasmus. During a voyage in the Pacific Ocean in the year 1600, the Erasmus is shipwrecked in Japan. Blackthorne must survive in a land where every custom is as unfamiliar to him as the language. After learning some of the society's ways, he is drawn into a political struggle between warlords and falls in love with a Japanese woman.
As the title indicates, the game is based on the book Shōgun by James Clavell.