Arn Magnusson remembers, as a fearful crusading templar, his youth in fractured Sweden's West Gotland. He and his brother Erskin were friends with king Erik's son Knut, until a neighboring warlord killed the king to seize the crown during the local church's solemn consecration. After Arn's seemingly fatal fall and 'miraculous survival', his mother insisted on keeping a promise to God to offer the boy as oblate to the regional abbey. There abbot Henri allowed father Guilbert, a former templar, to add warrior skills to his monastic education. After an incident in which he was forced to kill a bride-robber in a duel, Arn tries to prevent his family's feud with a haughty neighbor's getting bloodily out of hand.

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Arn's brothers wold be-fiancée fails to seduce Arn before he finds out she's the sister of his beloved. Prince Knut, now an adult, is back from Norwegian exile to reclaim the throne. He lures crack archer Arn to help him kill the usurper, but Arn's family fears that only leads to civil war. Arn's siren convinces the bishop that her alleged lover Arn and his true love, her sister, committed mortal sins, so they are confined to strict convents for 'half their lives', 20 years. Arn's abbot however gets his sentence commuted into joining the Knights Templars, a crusading order.

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Arn is now a seasoned Templar, enjoying trust and respect of the grand master. His chivalrous behavior towards Muslim passersby wins him the respect of sultan Saladin, who was anonymously among them. When Saladin's army marches to besiege Jerusalem, he sends a retainer to offer Arn safe passage, which is declined. Arn correctly analyzes the enemy's best route and sets a masterly trap, which forces Saladin to retreat for the time being. Back home, Arn's beloved Cecilia gave birth to their son, which was taken away, and suffers a horror regime under the Sverker abbess. She befriends another Cecilia, who turns out the fiancée of Knut. When he comes collect her, the abbess must promise a decent treatment.

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At the end of his penance term of 20 years, Templar Arn expects to return home with an honorable discharge from the late grandmaster after a last desert mission, during which he must defeat fellow knights to prevent Bedouin allies being slaughtered. The grandmaster's successor tears it up, claiming victory over Saladin is at hand and imposing foolish risks. In Sweden, his bride Cecilia is offered to succeed the wicked abbess, who dies cursing her for refusing to forgive. However she chooses to leave, visit their son Magnus, now a man, and seeking to find and marry Arn at last.

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The haughty grandmaster's expedition ends as disastrously as Arn warned: the crusader army is annihilated by Saladin's at the battle of Hattin. The sultan's brother however rescues badly wounded Arn from the battlefield, nurses him to health and accompanies him home to Sweden. They arrive just in time to prevent Cecioa, who was told all Templars were dead, accepting to becoming abbess for the family's political sake. Their patriarchs' objections result in the bishop forbidding a wedding, but the archbishop undoes that after an intervention from the bride's friend, Knud's queen. The happy couple is now united with their strapping son Magnus, squire to the Folkung patriarch.

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After happy years for Arn and his finally reunited family, king Knut is dying, spelling a bloody civil war. Fearing a Danish intervention would be fatal, the Folkungs arrange a deal by which Karl, whose father's throne Knut re-usurped, succeeds but must adopt Knut's firstborn Erik as crown prince. Rightly suspecting foul play, Arn sends his Danish former Templars squire along as supposed turncoat, in fact Eric's bodyguard. After he prevents Eric and his brothers, one of which is however slain, being cowardly drowned, Arn takes command of a revolt, heading for an epically bloody battle.

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