Sora, Donald, and Goofy find themselves in Port Royal, a world that seems much darker than what they're used to. Shortly after arriving, they hear screams, so they go to investigate. Meanwhile, Pete is meeting with a group of pirates led by Captain Hector Barbossa, who explains that he and his crew are cursed by an Aztec treasure; when they are exposed to the moonlight, they transform into undead skeletons. Pete tells them to be wary of Sora and friends' magic, since they don't play by the rules of that world. When they show up, Barbossa sends half of his crew to attack them. At first, the pirates seem invincible, but when the moonlight shines and reveals their true forms, they become vulnerable. Pete accidentally lets their secret slip, and the trio takes advantage of it.
In the town, a man named Will Turner is chasing after a pirate, who kidnapped a woman named Elizabeth Swann. He is suddenly attacked by the Heartless, but Sora, Donald, and Goofy show up in time to save him. After the battle, Will asks them for help to get Elizabeth back, but by the time they reach the port, the pirates have already set sail. They meet another pirate, Jack Sparrow, who announces that he plans to take control of another ship called the Interceptor. It is revealed that Will broke Jack out of prison. After Will asks him for help, he initially refuses, but when Will points out that he needs a crew, Jack relents.
Meanwhile, aboard the Black Pearl, Barbossa's ship, the captain explains the nature of the curse to the captive Elizabeth. He tells her that his crew found the 882 cursed gold coins given by the Aztecs to Hernan Cortes on the Isla de Muerta. The pirates spent it all, but the more they spent, the more miserable they became. Barbossa tells Elizabeth that they can break the curse if they return all the gold to the chest, but that they were never able to locate the last coin until they found Elizabeth, who had it on her amulet. Additionally, the pirates also need to spill someone's blood to break the curse, and they plan to use Elizabeth for that purpose. She runs up to the deck of the Black Pearl in a panic, where she is greeted by the true forms of the cursed pirates.
On board the Interceptor, Jack reveals that the Black Pearl used to belong to him, and that Barbossa was once his partner; however, he betrayed him and took the gold for himself, which allowed Jack to avoid being cursed. They arrive at the Isla de Muerta, where Jack has Sora, Donald, and Goofy guard the ship while he and Will confront Barbossa and his crew. After a while of waiting, the three friends decide that if Pete and the Heartless are involved, they should go investigate themselves. In the cave inside the island, Will and Jack spy on the pirates, who are preparing to perform their ritual. As the trio approaches the cave entrance, Will and Elizabeth emerge from the cave, with the pirates in hot pursuit. Sora, Donald, and Goofy hold them off while they prepare to set sail. Once the Interceptor is ready, they board the ship and take off.
After they escape the island, Will explains what happened inside the cave: Jack was selfish and refused to act until the moment was right for him to make a profit, so Will knocked him out and proceeded to rescue Elizabeth on his own. While he made his way to the area with the treasure, Barbossa spilled Elizabeth's blood with a knife, let the blood cover the last coin, and dropped it into the chest. When they completed the ritual, however, nothing happened; they were still cursed. It turns out that they needed to spill the blood of William Turner to undo the curse, and Elizabeth had lied, telling them that she was Turner's daughter. Barbossa angrily tossed Elizabeth to the ground, and the blood-covered coin fell out. While the pirates were busy trying to figure out what happened, Elizabeth grabbed the coin, and Will snuck in to help her escape.
It is revealed that Elizabeth's amulet was actually a gift given to Will by his father. He washed up on the shore one day, and Elizabeth found it. She gives it back to him and apologizes for taking it. Will realizes that Barbossa and his crew need his blood, because they need the blood of a pirate to complete the ritual. His father was a pirate, so the blood of a pirate flows through him. Meanwhile, on board the Black Pearl, Jack has been captured by Barbossa. The Black Pearl approaches the Interceptor, and a battle commences between the two ships. Sora and friends try to fight them off, but Barbossa and his crew manage to make it onto the Interceptor, taking Elizabeth once again in the process. Just as the situation seems hopeless, Will comes up with an idea: he reveals to Barbossa that he has the blood they need, and he threatens to kill himself and throw his body into the sea unless the pirates give up his friends and leave.
Barbossa agrees to these terms, but there's a catch: Will only stipulated that the pirates leave, and no one else. Pete and the Heartless show up and capture them all before filling the ship with bombs. They take Will aboard the Black Pearl and leave the rest of them on the Interceptor. Afterwards, Jack manages to escape captivity. He frees the rest of them, and they manage to destroy the Heartless and the bombs, but Pete and the pirates are gone. After regaining control of the Interceptor, they make their way back to the Isla de Muerta.
Back on the cursed island, they find another Absent Silhouette, this time of Larxene. They fight her phantom and emerge victorious before proceeding onward. They reach the area with the treasure just before Barbossa can perform the ritual. He sends his crew after them, but they manage to defeat the cursed pirates and save Will. Meanwhile, Jack and Barbossa duel each other. Barbossa stabs Jack through the chest, seemingly killing him, but Jack reveals that he took one of the cursed coins, making it impossible for him to die by Barbossa's hands. A desperate Barbossa calls for Pete's help. He appears and summons a Heartless called Illuminator, which has the power to drain light from its surroundings and fill the area with darkness.
The group destroys the Illuminator, causing Pete to flee. It seems as though Barbossa has been defeated, but he still lives due to the curse. Jack pulls out a pistol and throws the coin he took over to Will before firing it. Barbossa mocks Jack for thinking he can kill him, but Will drops both Jack's coin and his own, now with his blood on it, into the chest. The curse is finally undone, and Barbossa feels the pain of the bullet in his chest as he regains his mortality. He gets his wish of becoming human again, but he dies as soon as the curse ends. The groups heads back, and Jack gloats over the fact that he finally got the Black Pearl back. His compass turns out to be what Sora needs to open the next gate, allowing the trio to gain access to the next world. With that, they continue to the next step of their journey...
- Adaptational Jerkass: None of Barbossa's more sympathetic traits are carried over from the movie. Here, he doesn't even offer a Cruel Mercy to the party, and outright condemns a child to be blown up on a gunpower-rigged ship.
- Arc Hero: Jack Sparrow and Will Turner rotate this role, although it is Jack who serves as the Guest-Star Party Member.
- Arc Villain: Barbossa, as in the film.
- Even the Loving Hero Has Hated Ones: Sora vows to hate Barbossa forever. This sticks, as they're still enemies in Kingdom Hearts III even though Barbossa is (somewhat) allied with Jack.
- Hold the Line: At one point, Sora has to keep the pirates from getting to the Interceptor for a single minute as Will prepares her for sail.
- Locked Up and Left Behind: Barbossa does this to the party, leaving them tied up inside the cargo deck of the Interceptor while leaving gunpowder barrels along her deck.
- Not His Sled: Will's demands are denied in this continuity. Instead of letting Elizabeth (and Sora's party) go free, as per request, Barbossa instead has them and Jack tied up and left behind with the Interceptor rigged with gunpowder.
- Not in This for Your Revolution: Jack only cares about reclaiming his stolen ship, although he does have a Hidden Heart of Gold, and comes to Sora's aid after Pete defeats him.
- Not-So-Harmless Villain: Pete is a Jerk with a Heart of Jerk, but until this point, he's been nothing but a bumbling henchman for Maleficent. Here, he shows sociopathic glee in letting Sora, Donald, and Goofy (and, by extension, Roxas and Ventus) be blown up so he could rid of himself of rivals. He only gets worse from here.
- Required Party Member: Jack is mandatory when he joins the party the second time, since he's needed for the boss battle against Barbossa.
- Team Rocket Wins: Pete finally scores a victory against SDG here because Barbossa wouldn't agree to Will's demands. They only survive because of Jack.
- This Is Unforgivable!: Sora vows to never trust pirates again after Barbossa makes an attempt on his life. Said grudge continues in Kingdom Hearts III.
- Wrong Context Magic: The Aztec curse. Normally, the curse means those who are cursed are immune to anything. Or at least, anything within this world. Once Sora shows up, it turns out the Keyblade is able to bypass this rule and hurt the cursed pirates as long as they are within the moonlight. Too bad Captain Jack Sparrow is the exception...
- Would Hurt a Child: Barbossa and Pete have no problems with letting a 15-year-old boy be blown up.
