The Orb of the Moons glows, and the Avatar finds that a red moongate has appeared behind the house. The Avatar thus returns to Britannia through the moongate, and arrives in Trinsic, where he[7] meets Iolo. Iolo tells him that two centuries have passed since he left. The whole town is shocked due to a ritualistic murder that occurred the preceding night - the body of the blacksmith Christopher was found in the stable. Finnigan, Mayor of Trinsic, asks the Avatar to investigate the incident.

In Trinsic, the Avatar gets to meet several members of a new religious organization called the Fellowship. Eventually, in Britain, he meets Batlin, one of the founders of the Fellowship. He also meets Lord British, who urges the Avatar to join the Fellowship, which, according to him, has done a lot of good things. It also turns out most of the mages of the realm have gone completely insane without any good explanation, and their magic doesn't work as it should.

Forge of Virtue was an expansion pack that adds a quest to Ultima VII in which the Avatar must pass a series of tests to revalidate himself in the three principles of Truth, Love, and Courage, and destroy the last remnants of Exodus.

With the expansion, an earthquake takes place at the beginning of the game. After speaking to Lord British about the tremors, the player will be given free use of a ship called The Golden Ankh, and can visit the Isle of Fire to begin the expansion subquests. The Isle of Fire was previously the site of Castle Exodus in Ultima III, and reappears only during this game.