宇宙世纪0088年，经过格利普斯战役，提坦兹（Titans）被消灭，奥古（AEUG）的实力也大大削弱。吉恩军残余部队在摄政王哈曼・坎恩的率领下趁机以“新吉恩”的名义称霸地球。

在格利普斯战役中受损的奥古军宇宙战舰“阿伽马号”临时停靠在Side1的殖民卫星“香格里拉”。此地经营废品回收业务的捷度・阿西塔和朋友们盯上了阿伽马内的Z高达，准备偷出来卖钱。恰好此时与阿伽马敌对的新吉恩军巡洋舰“安多拉号”也来到了香格里拉，捷度等人被卷入了战斗。

Universal Century 0079. Humanity has turned even space itself into a battlefield, and the Principality of Zeon forces advance after wiping out half the world's population by carrying out the Operation British (colony drop). In response, the Earth Federation Forces mobilize their overwhelming fighting strength to regain the advantage. The complex intrigues of the Zabi family... Sayla Mass, as she contends with the whims of fate... Hamon and Ramba Ral, who is now a pilot in the Zeon forces... Amuro and Fraw, leading peaceful lives at Side 7... a dark shadow falls across them all. And the Zeon ace Char Aznable, driven by revenge, goes into action as the "Battle of Loum" finally begins.

After the Dawn Rebellion, Char travels to Earth and meets a girl with mysterious powers named Lalah Sune.
Meanwhile, Amuro's father Tem Ray is working on the RX-78 development project. Learning of the defection of Doctor Minovsky, a key figure in Zeon mobile suit development, he heads for the moon. History's first battle between mobile suits unfolds in the twilight zone of the lunar surface.
Then comes Universal Century 0079. Side 3, the space city furthest from the Earth, launches a war of independence against the Earth Federation government under the name of the Principality of Zeon.
An era of violent upheaval begins, in which half of the total human population will be killed...

Universal Century 0068, Side 3 - The Autonomous Republic of Munzo. Zeon Zum Deikun attempts to declare complete independence of Munzo from the Earth Federation Government, while he preaches the evolutionary potential of humans who have advanced into outer space. Deikun however suddenly falls to his death in the middle of his speech at parliament. Upon Deikun's death, Jimba Ral spreads word of a House of Zabi conspiracy - but despite such efforts the power and sphere of influence of House of Zabi, led by Degwin Sodo Zabi, only seem to escalate. While we witness for the first time the untold convulsions of Universal Century history, Casval and Artesia, just bereaved of their father, must face destinies which will be just as tumultuous as the very era itself.

In the year UC 0071, three years after escaping the Zabi faction on an Ocean Cargo ship, Artesia and Casval are living happily in Andalusia, Spain, Earth under the identities of Sayla Mass and Éduoard Mass, respectively; masquerading as the children of Don Teabolo Mass, a long time friend of their father Zeon Zum Deikun.