At the beginning of the story, much of the world has been destroyed by the Festum and the remote Japanese island of Tatsumiyajima (竜宮島?, lit. Dragon Palace Island) has only remained unscathed by virtue of an advanced cloaking shield. The island's young people continue with their daily lives unaware of these events, but after many years of peace a lone Festum discovers Tatsumiyajima and attacks. The adults activate Tatsumiyajima's hidden defense systems and attempt to repel the attacker but to no avail. Many of them are killed by the Festum in a process of assimilation. In desperation, they order the deployment of a Mecha called the Fafner Mark Elf, but its pilot is killed en route to the hangar. Left with no further options, they send a young boy named Kazuki Makabe as the replacement pilot assisted by Soushi Minashiro from within the Siegfried System.

The Festum is destroyed, but with Tasumiyajima's whereabouts exposed, the adults choose to relocate the island. Production is accelerated on additional Fafner units and more children are recruited to pilot them. It is also revealed that the cloaking was not meant to conceal Tatsumiyajima from only the Festum, but from the rest of humanity who would seek to use its technology in the greater war against them.

Fafner in the Azure (蒼穹のファフナー, Sōkyū no Fafunā?) is a 26-episode anime series produced by Xebec. The story focuses on a group of children who pilot the titular Fafners in an escalating war against giant aliens called Festum. The anime is subtitled Dead Aggressor. A television special subtitled RIGHT OF LEFT aired on December 29, 2005, and a feature film subtitled HEAVEN AND EARTH had a theatrical release in Japan on December 25, 2010.

The character designs were created by Hisashi Hirai, who is also known for his work on Infinite Ryvius, s-CRY-ed, Gundam SEED, and Gundam SEED Destiny. Tow Ubukata, creator of works like Le Chevalier D'Eon and Mardock Scramble, provided scripting for the latter half of the series. The mecha designer was Naohiro Washio.