Sonic and the Black Knight is the second chapter of Sonic's Storybook Series. Now Sonic ventures in the land of King Arthur and the Knights of the Round of the Round Table.
A wizard named Merlina, granddaughter of Merlin, running away from some pursuer, summoned Sonic to help free the mystical realm of King Arthur, who had been possessed by an unknown evil that came from Excalibur's scabbard, and was now ruling the realm as the tyrannical Black Knight. Sonic's speed alone would not end the Black Knight's reign, so he must take up the talking sword, Caliburn and master swordsmanship in order to break Arthur's curse and save the kingdom.
In Part One, it takes place in the World of Camelot. While on the run from the Black Knight and his demonic minions of the underworld, Merlina was surrounded by the Black Knight's minions, and, before she was taken, performed a summoning ritual that brought Sonic to her world. Sonic defeated the Black Knight's minions before Merlina teleported them both away in a whirlwind. The Black Knight sent out his three Knights of the Round Table, who were still loyal to the Black Knight despite his evil, to find and kill Sonic and Merlina on sight. Merlina explained that the Black Knight, once King Arthur, was immortal, as he possessed the scabbard of Excalibur. After training Sonic in the art of swordsmanship, Merlina explained that King Arthur was once a wise and just ruler, but became corrupted by the power of immortality granted by having possession of Excalibur's scabbard. Sonic acquired Caliburn, a talking sword who was highly skeptical of Sonic's abilities, and they headed off on their quest while Merlina stayed behind in hiding (Merlina explained that she would be recognized in town). They first found the Blacksmith (Tails' counterpart in the game) in the Castle Town, in order to sharpen Caliburn's blade. The Blacksmith recognized Caliburn, but couldn't remember when he has heard of its name before.
Sonic headed off to see Nimue, the Lady of the Lake (Amy's counterpart in the game) and previous owner of the scabbard of Excalibur, to find out how to stop the Black Knight; on his way, he encountered and defeated Lancelot (Shadow's counterpart in the game), one of the Knights of The Round Table, and claimed his sword. The Lady revealed that she will only assist Sonic when he becomes a true knight and presents him with three tests to be completed in three days. After completing them, Sonic soon encountered a crying child whose village was abducted by a dragon and decided to help her. Sonic soon encountered and defeated Gawain (Knuckles' counterpart in the game), and takes his sword before he was able to kill himself out of shame with it, asking him if there was more to being a knight than serving a king. With the townsfolk saved, Nimue revealed that she was the crying child and was testing Sonic, and that he can blunt the scabbard's power by retrieving the sacred swords wielded by the Knights of the Round Table. Afterwards, Sonic met Percival (Blaze's counterpart in the game) and defeated her before saving her from falling from a cliff, an act that finally earned him Caliburn's respect and the title of "Knight of the Wind". Merlina had seen those events from her reflecting pool, and arrived to inform Sonic that the Black Knight is on Faraway Avalon. Sonic and Caliburn pursued and defeated the Black Knight with the power of the three sacred swords.
In Part Two, it takes place after defeating King Arthur. Having fought and defeated him by using the four Sacred Swords (including Caliburn), Merlina revealed to Sonic and The Knights of the Round Table that King Arthur was an illusion conjured by her grandfather, Merlin. She then takes Excalibur's scabbard to become all-powerful, so she can be the new queen.
Sonic and the Knights of the Round Table were forced to flee and, with Nimue's help, set off to use the sacred swords to defeat Merlina by putting up a barrier around the kingdom, which is then revealed that was too weak. After the four swords formed a barrier around the castle, Sonic confronted Merlina, who explained that she knew the kingdom will soon come to an end, and wanted to make it last forever. Sonic battled her, but was outmatched; in the process, Caliburn was broken in half, and Sonic took a very severe beating. Nimue and the Knights watched Sonic's efforts, and shouted at him to run. Sonic refused, resolving to stop Merlina no matter what. Sonic's determination, combined with the power of the sacred swords, repaired Caliburn, and the duo transformed into Excalibur Sonic and the true Excalibur, respectively, while Merlina transformed into a monstrous creature known as "The Dark Queen". After a long battle, Sonic and Caliburn managed to defeat Merlina. Though Merlina continued to lament the fate of the kingdom, Sonic gave her a flower and told her that, while all worlds have to end, they merely need to live life to the fullest in the time that they have; reminiscing about her grandfather, Merlina took his advice to her heart.
Afterwards, Lancelot said that the Knights of the Round Table will have to disband now that King Arthur was gone, but Caliburn reminded them that he was the one who chooses the one to be king; thus, Sonic was the true King Arthur. After the credits roll, Sonic, who had been taken back to his world, explained his journey to Amy Rose. She then complained that he was lying and forgot about their date, then proceeded to attack him with her Piko Piko Hammer. The game then showed a book titled King Arthur and the Knights of the Round Table changed its title to Sonic and the Black Knight, the same process in the previous game, Sonic and the Secret Rings.

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