The story begins with Lara Croft's origins as a teenaged tomb raider, accompanied by her then mentor, Werner Von Croy. They travel to the temple of Angkor Wat, Cambodia in the hope of finding the mystical "Iris." However, the trip is cut short by an accident where Lara is forced to abandon her companion, whom she believes perished, in order to save her own life.

Back in the current year in which the game is set (1999), Lara finds herself in Egypt, Lara Croft uncovers an ancient tomb where a fearsome Egyptian God Set was once imprisoned. She unwittingly unleashes him and finds herself in a deadly race against time to restore the god to his resting place before an apocalypse befalls Earth.

Unfortunately, Von Croy becomes Lara's new rival as he is possessed by Set himself and he makes things considerably more difficult. Lara travels across Egypt to collect the pieces of Horus' armour in order to defeat Set. They are found in Pharos, Temple of Isis, Temple of Poseidon and Cleopatra's Palaces. She combines them (with the Amulet of Horus) in the Temple of Horus to finally defeat her enemy. However before Horus can be summoned, Set arrives and destroys the armour, knocking the amulet into the water. Lara quickly recovers it and exits the Temple sealing the entrance shut with the amulet. She must leave it in place to keep Set imprisoned for eternity. As she reaches the exit of the temple, injured and exhausted, she is confronted by Von Croy. Fearful that he may still be possessed she is reluctant to hold onto his outstretched hands and so she falls into the darkness beneath the collapsing temple.