Greenvale is a small, peaceful town somewhere in the northern United States. The sudden and brutal murder of a young girl draws the attention of FBI agent Francis York Morgan, a man with an unclear past, a split personality named Zach, and a personal interest in cases like this. York comes to Greenvale to assist local law enforcement in solving the murder, whether they like it or not, but things aren't nearly as simple as they might seem at first. Strange red seeds, a mysterious man in a red raincoat, and the secrets held by those in the town...

Deadly Premonition is a survival horror mystery game with open-world elements. The player controls Agent York as he investigates the mysterious circumstances in Greenvale. Greenvale itself is a large, open town that can be freely explored on foot or in a vehicle, with a slightly-accelerated day/night cycle dictating when shops are open, when people are available to talk to, and when missions to drive the story forward are available. York himself must eat and sleep (or at least drink coffee), as well as shave regularly and wash his clothes when they get dirty. There are shops and restaurants around Greenvale where items and weaponry can be purchased.

York has a variety of weapons at his disposal. His basic weapon is an FBI-issue pistol which has infinite ammo, but there are also a variety of other firearms available including machine guns and revolvers, each of which has its own strengths against different types of enemies. There are also a variety of blunt and bladed weapons, including knives, crowbars, and golf clubs. He can also evade enemies by running or holding his breath, but while doing these his pulse rate will rise, and if it goes too high he will get tired and be unable to move quickly for a short period of time.

Many of the story missions feature an element called "profiling", in which the player must collect evidence in order to piece together what happened in that area. As evidence is collected, the images in the scene become clearer, until all the evidence is collected and York becomes sure of what happened.

In addition to the main story missions, there are also a large variety of side missions. York can go fishing, as well as take part in time trial races or even play a game of darts. There are missions for many of the characters offering various rewards, and there are also dozens of hidden trading cards to collect. He can also purchase new suits, and even vehicles.