Bahamut Lagoon is a tactical role-playing game. The player controls several parties of four characters each, and commands different dragons at once. The battles start on a top-down screen typical for strategy games, but often switch to a dynamic side view, such as often used in Japanese-style RPGs. The outcome of some battles can also be affected by other tactical decisions, such as, for example, setting a whole forest on fire to prevent enemies from coming through it.