The third game, in a break from tradition, is not a point-and-click but instead a 3D adventure game that incorporates action elements such as crawling, first-person view mode and the manual use of certain objects. The decision to switch to 3D was made as a result of pressure from potential publishers.

It opens with a lengthy cut-scene explaining how Simon's body, which had been separated from his soul by Sordid in the second game, was recovered and "rejoined" with his soul. At the start of the game Simon's immediate objective is to get to the city Poliganis and join Calypso. Before he can do this several smaller tasks have to be completed, in typical adventure game fashion. Upon arriving in Poliganis he is greeted by Melissa Leg, the heroine who apparently rescued his body from Sordid. She wants a favour in return: to track down the Swampling and let her know of his whereabouts. Eventually Simon finds the Swampling, after which several revelations regarding the game's storyline, the origins of the Universe, etc. come to light.

The sarcastic attitude and cruel humour that Simon the Sorcerer is famous for carries through in this instalment, perhaps bringing it up a level again from Simon 2. Along with this, several of the mainstay characters shared with the first two games make appearances, including Calypso, the Swampling, Goldilocks, the RPG players (a different faction this time), the Hedgehog Boy, Sordid, Runt, and the two Demons. There are many new characters also, continuing the theme of a fantasy world and including a Fairy Godmother, Judas, the High Priest of the Temple of Life, the Keeper of the Soul Bell, the man in the hole, the Entomologist, the Inbred Yokel (and Daisy), the Dwarf Prince and his clan, the Dragon Soddinell, S.I.G.N. the alcoholic golem, the Gnomes and the noblemen who fire them, a heroic prince, Coneman the Barabrain (his spelling was never very good), Jar Nin, the real Melissa Leg, a Welsh cheese wagon driver, the Barman with a hunch, Yvette, the vacuum cleaner salesman, the Sheriff, Porkins, the Wizard's Guild, various Orcs, street urchins, the Pizza Lord and his brother, the woodcutter, the lawyer, Grandulf, a drunken Druid, the Princess and Sir Squeaksalot, and the Wigologist.