A year after defeating Emperor Tachyon and witnessing the Zoni abduction of Clank at the end of Tools of Destruction, Ratchet and his partner Talwyn Apogee learn from the IRIS Supercomputer that Captain Angstrom Darkwater, a legendary space pirate, is the only individual with knowledge of how to contact the Zoni. Traveling to his home planet of Merdegraw in the Drogol Sector, the duo slip aboard a pirate fleet above the Azorean Sea, but are soon discovered and captured by Sprocket, Darkwater's first mate, who reveals that Darkwater has been dead for years. Seconds before the two are to be executed, Rusty Pete shows up disguised as Captain Romulus Slag (who Ratchet defeated in Tools of Destruction) and instead orders them to be marooned on Hoolefar Island.

After experiencing a brief vision of Clank surrounded by glowing energy, Ratchet reunites with Talwyn and meets the local leader, Mayor Barnabas Worley. He dispatches Ratchet to restore the island's power supply by restarting several wind turbines and then directs him to the town's radio operator, who asks Ratchet to purchase a Versabolt from the Smuggler so he can make badly needed repairs. As a reward for providing assistance, Worley reveals the existence of the Obsidian Eye, a powerful lorentzian telescope Darkwater built to maintain a link to the Zoni's home dimension. Unfortunately, the Eye's power source, an artifact known as the Fulcrum Star, was hidden by Darkwater shortly before he was killed in a mutiny organized by Slag.