The non-aggression pact between the flourishing maritime city of Itha and the barren military state of Paro comes to an end when the latter's greedy monarch attempts to sabotage Itha and target its riches. Following this dreadful incident, the escalating animosity on each side disturbs the happiness of Itha's princess Ahnas and Paro's prince Jill, both of whom are deeply in love.

The peaceful farmers from the village of Saki are worried as well. With their land separating Itha and Paro, they risk getting caught in the crossfire of an upcoming battle. Yet there is one among them that does not share such fear. Izu—an ambitious, energetic young man—sees this war as an opportunity to gain fame and wealth. Enticed by Paro's promise of a generous reward, he readily answers the kingdom's call for help, vowing to his beloved wife Marin that they will soon reunite.

Feeling heartbroken, Marin becomes engrossed in prayer for her husband's safe return. Meanwhile, Ahnas and Jill are determined to not let their positions or their families' hostilities come between them. But will these young people's genuine love prevail over human foolishness and vices, or will it be sacrificed to petty ambitions?

Although the story was originally conceived for the production of an anime, Windaria first appeared as a novel titled Douwa Meita Senshi Windaria four months prior to the movie's release. As stated in the postscript, the author believed this reading would further entice people to watch the film.

The movie was broadcasted several times on Yomiuri TV's Anime Daisuki! program. An English version was made available under the title Once Upon a Time by Harmony Gold in 1987. However, in order to make it suitable for a younger audience, major changes were made: the exclusion of some nudity and violent scenes, modification of the script, new character names, and added narration.

In Japan, Windaria was initially distributed to home video by Victor Entertainment, which later released it on DVD on December 16, 2000. In the US, it was made available on VHS as Windaria by Streamline Pictures on August 1, 1993, and on DVD as Once Upon a Time by ADV Films on March 16, 2004. Additionally, a video game adaptation titled Dungeon of Windaria was released in Japan by Nintendo on May 15, 2008.