In late 1135, Henry I, King of England, died unexpectedly, leaving no male heir to rule in his stead. Henry's daughter, the Empress Matilda, believed she should rule by succession. However, the late king's favorite nephew, Stephen of Blois, was quicker to accede to the throne and, with the help of his brother, the Bishop of Winchester, was crowned king. Those loyal to the Empress were outraged by Stephen's coronation and did not accept him as their new ruler. Over the next eighteen years, England saw law and order collapse, and civil war spread across the country. This conflict became known as "The Anarchy."

In The Anarchy players take on the roles of English nobles loyal to King Stephen. Over the course of five rounds players must build their domain, defend their castle from the approaching Angevin armies, and assault Matilda's strongholds with their siege weapons. The player who can accumulate the most courage, loyalty, influence, and strength while avoiding discontent will prove to King Stephen that he is his most loyal ally, and thus earn the largest county.