The novel opens with Liriel Baenre rescuing Hrolf the Unruly from prison in Skullport to his ship, the Elfmaid. With the help of Liriel's magic, the Elfmaid is able to pass through the magical portals of Skullport to the Sea of Swords, heading for Ruathym with a few stops on the side.
Meanwhile, Caladorn Cassalanter, sailing with seal-hunters on the Cutter in the waters near Luskan, captures a ship and discovers it is filled with barrels of pickled sea elves. The barrels are marked with Ruathen symbols, indicating a plot to implicate Ruathym in the tragedy. The Elfmaid picks up the Cutter and strands its occupants without realizing they had not been the perpetrators. The surviving crew is saved by Xzorsh, the sea elf ranger.
It turns out that the High Captains of Luskan are planning a war against Ruathym, using falsified atrocities to turn Waterdeep and other members of the Lords' Alliance against the island. High Captain Rethnor allies with Vestress and the Kraken Society, based in Ascarle, and attempts to destroy the Elfmaid for interfering in his plans. The Elfmaid is able to escape only when Liriel calls on her clerical powers of Lolth, much to Fyodor's dismay.
The Elfmaid eventually docks in Ruathym, where Liriel and Fyodor hope to find Yggdrasil's Child, a tree on which Liriel must carve a rune in order to keep her drow magic and enable Fyodor control over his berserker rages. The only one who is knowledgeable about rune magic, however, is Ulf the Shaman and he refuses to help Liriel until she has passed some sort of unspoken test. Meanwhile, trouble abounds in Ruathym: for some reason, islanders are disappearing, and the woman (Ygraine) prophesied to restore the shapeshifting berserker magic of Ruathym has apparently been killed.
In the end, Shakti Hunzrin, Liriel's sworn foe, also allies with Vestress and Rethnor. Vestress seeks a kingdom to conquer using four steps: 1) obtain Liriel to cast out the drow banshee that has settled in Ruathym, 2) charm Wedigar with a nereid and force him to unknowingly shapeshift and kill people, 3) use Dagmar, Ygraine's twin sister, to kill selected Ruathen and plant kelpies in the water, and 4) use Rethnor's forces to weaken the people of Ruathym. In addition, Sittl, a malenti (mutated sahuagin taking the form of a sea elf) uses his friendship with Xzorsh and the sea elves to further harm Ruathym.
When Liriel and Fyodor learn of Ascarle's influence, they and the Ruathen summon allies from the sea to defeat Ascarle and release the prisoners, including Ygraine, held there. Liriel's part in the battle includes defeating the drow banshee and briefly becoming an avatar of Lolth, after which she renounces Lolth altogether. Liriel is able to draw her rune on Yggdrasil's Child and control Fyodor's berserker rages; he, in turn, makes her his witch. The next step is to bring the Windwalker amulet to Rashemen to fulfil Fyodor's quest.
- Dagmar, daughter of Ulf the Shaman and twin sister to Ygraine
- Hrolf the Unruly, captain of the Elfmaid
- Ibn, first mate of the Elfmaid
- Iskor, a water wraith
- Shakti Hunzrin, drow traitor-priestess of Lolth and Vhaeraun
- Sittl, a malenti (sahuagin) masquerading as a sea elf
- Rethnor, one of the High Captains of Luskan
- Vestress, illithid ruler of Ascarle
- Xzorsh, a sea elf
- Aumark Lithyl, First Axe of Ruathym
- Bjorn, member of the Elfmaid's crew
- Caladorn Cassalanter, secret Lord of Waterdeep
- Gromph Baenre, Archmage of Menzoberranzan
- Olvir, member of the Elfmaid's crew
- Ulf, shaman of Ruathym
- Wedigar Ruthgaald, First Axe of Holgerstead and shapeshifter of Ruathym
- Ygraine, twin sister to Dagmar
- Trisk, Purple Rocks
- Yartar, Savage Frontier