Leaving Locke behind to be treated, the party continues their quest to restore the lost areas, coming across the man from Kanata's dream, who introduces himself as Oboro, the king of the long lost Plated People, who joins them. Upon learning from the Empire that the lost phenomena is related to the Twilighter people, the party assists the imperial forces in capturing the Twilighters including their war maiden, Shera. However, the incident makes Kanata doubtful of the Twilighters being the culprits and the party breaks into the prison where Shera and the others are being kept to help them escape, with Shera joining the party afterwards. After learning that the Empire is preparing a massive scale attack on the village of Salny to get rid of the monsters there, the party attempts to stop them, as the memories residing in the monsters are needed for Kanata to restore the lost. Kanata and the others fail to stop the conflict which leads to the destruction of Salny, but befriend Dianto, a sentient monster who joins them. Branded as traitors by the Empire, the party then sets for the Kingdom of Graccia by Van's suggestion, but on the way they are continuously chased by the imperial forces, including Galdra and a cyborg developed by the Empire called Gears.
After failing to capture the party, Galdra confirms their good intentions and decides to join them, also revealing that contrary to the party's assumptions, she is a woman. Soon after, the party is attacked once more by Gears, whom they discover to be Locke turned into a combat machine by the Empire, and after the control chip on his body is disabled, he rejoins them. However, once arriving at the Royal Capital Marche, which was also lost, Kanata fails to use his power to restore it. Van in response betrays Kanata by critically injuring him before he flees. Confirming that Kanata is still alive, but unable to figure out how to save him, the rest of the party chases after Van seeking answers, just to discover that he was being deceived by a mysterious being called Krom, who was impersonating his father, the King of Graccia, to make him do his bidding. Determined to help restore Kanata to make amends, Van rejoins the party, who seeks help from Emperor Neodeus to project their memories into Kanata's body to help restore him. In the occasion, they discover that Krom is an ancient researcher who intends to take control of the power of the Moon to become all powerful and recreate the world in his fashion.
With Kanata restored, the party departs to confront Krom in his flying fortress, the Dhaka Venu, but Krom easily defeats them, killing Neodeus in the occasion. After retreating, they learn of a powerful ancient weapon called the "Lunaripper", which was deemed so dangerous that its blueprints were split in two between Gigante and Graccia. To retrieve Graccia's half of the blueprint, the party embarks on a quest to bring Kanata's powers to their full potential, allowing him to finally restore Marche. After the Lunaripper is completed, the party launches a second attack on the Dhaka Venu, apparently destroying Krom, but sometime later, Kanata awakens in a mysterious place, where he rejoins with the rest of his party, except for Lumina. Once they reach Lumina, Krom reveals himself and attempts to steal the Spiritnite Core, a part of the moon's power residing in Lumina's body but Kanata stops him.
Discovering that they are trapped in the same place where people are sent after being lost, the party looks for a way to return home when they meet Memoria, a little girl who used to live with Kanata's mother, Eiche, before she passed away. With Memoria's help, Kanata briefly restores his mother and learns from her that he was given to her by the moon, who answered her wish to have a child, which is the origin of his powers. After Eiche passes away again, the party takes Memoria with them, but once they find a way to get back to their world, Krom appears to interfere, and Memoria sacrifices herself by staying behind to help the others return safely. Back to the real world, the party learns that Krom's monsters are overrunning the population, and assisted by their allies, come with a way to go all the way to the moon to fight him one last time.
Once Krom is finally defeated, he threatens to destroy the moon should he be killed, but he is slain by Kanata nonetheless. As the moon begins to collapse, Kanata and Lumina instructs the rest of the party to flee to safety while they stay behind and attempt to restore the moon with their powers combined, but fail. Lumina then chooses to sacrifice herself to restore the moon. The player than has two choices: Allow Lumina to fuse herself with the moon's core or preventing her from doing so. If Kanata does not stop Lumina, the moon is fully restored and he returns alone to the others. If he stops her, the moon's destruction is halted, but it is unknown how long it will hold before it collapses, eventually destroying the world, while Kanata and Lumina reunite with their friends. Despite his choice, Kanata then starts traveling the world to restore the rest of the lost, accompanied by Lumina should she return with him, while the others follow their separate ways.
Reception and sales
The game's initial Japanese release far undersold the numbers of its predecessor I Am Setsuna; while I Am Setsuna sold a combined 61,623 copies between 33,629 on PS4 and 27,994 on Vita, while Lost Sphear sold only 7,363 on PS4, and 5,770 on Switch. Dengeki stated that the game only sold about 20% of its initial shipment, indicating that Square Enix likely expected it to sell more as well.
Both the PS4 and Switch versions of Lost Sphear received 32/40 review scores from Famitsu. PCGamesN praised the game for being similar to Chrono Trigger, concluding "It is so familiar, and so well executed, it can’t help but bring you joy...But it is not all nostalgia, and in fact, when it comes down to the brass tacks of gameplay, it is the freshest RPG I have played in some time."