Years before Siegfried's birth, opressed German peasants revolted against the Holy Roman Empire. The Empire's forces had been weakened by the Italian Wars, and this was finally the peasant's chance for freedom. One of their champions was Sir Frederick, a brave knight who led the peasants' forces into battle. While on one campaign, Frederick met a lovely young woman named Margaret and spent the night in her arms. After nine long months of battle, Frederick returned to find that Margaret had given birth to their son. They named their son Siegfried, after a legendary hero, and then the two were married. As Siegfried grew, his father taught him swordsmanship. Siegfried loved his father, but the "gentle knight" had many duties to perform. Frederick embarked on a foreign crusade, promising to return soon. Without his father's gentle hand to guide him, young Siegfried fell into the wrong crowds and soon joined a band of outlaws. His strength grew and he formed his own band of theives known as the Schwarzwind (Black Wind). One day, Siegfried hatched his master plan. The Schwarzwind could hunt down the knights who had run away from the crusades and steal their armor and loot. This would make the Shwarzwind rich, and Siegfried a very powerful man. That night, a group of war-weary knights approached, and the Schwarzwind ambushed them. The knights, fatigued from battle and the long march home, were no match for the theives and were defeated easily. Siegfried hunted down and killed the knight's commander himself, and chopped off his head with his proud Zweihander. He held the decapitated head up in triumph for the rest of the band to see, and it was then that Siegfried finally got a good look at the commander's face. It was his father! Siegfried let out a horrified scream, and his mind snapped. He fled into the forest in grief and fear.

Siegfried becomes Nightmare

After the slaying of his father, Siegfried spent days in solitude, constantly grieving. His insanity grew, and in denial he was able to convince himself that someone else slew his father. He grew determined to find the killer and avenge his father's death. When he emerged from the woods, he heard a tale of the invincible sword, Soul Edge, and he came to believe that his father's imaginary killer could only be defeated by this weapon. Thus, he pledged to never rest until he found the sword and avenged his father. His first lead was the legendary sword of Sir Stephan, which was quite well known in the region. In order to get closer to the sword, Siegfried traveled to Ostrheinsburg castle and became the commander of Stephan's mercenary knights. During his time as commander, the forces of Marquis Andre layed siege to the castle. The castle was nearly destroyed by Andre's cannonfire, but Siegfried and his army held off the invaders. During the final battle, however, Siegfried saw that an opportunity had arisen. Stephan was alone in his chambers, so Siegfried went and slew the powerful knight. He then escaped from the castle undetected with Stephan's legendary sword Grimblade. He ran far into the Black Woods so that no one would find him and connect him with Stephan's murder. Holding Grimblade high, he asked the sword to grant him invincible power. Nothing happened, and Siegfried realized this was not the right sword. In disgust, he discarded the sword and resumed his search. Siegfried spent weeks searching. The longer his search continued, the more manic he became. He finally found a trace of the real Soul Edge and tracked it to a port town in Spain. As he entered the town, he witnessed a female ninja carrying another female warrior away from the docks. Going in the direction that they had come from, Siegfried came upon the dead body of the pirate Cervantes and one of the twin blades of Soul Edge laying beside him. His search was finally over! With this sword, he could find and defeat his father's killer. He reached to pick up the sword but was stopped when Cervantes' body became enveloped in hellfire. The burning corpse rose up as the essence of Soul Edge consumed Cervantes' body. With a flash, Soul Edge and Seigfried began a savage battle. With madness in his eyes, the determined Siegfried emerged victorious and claimed the remaining sword as his own. The instant he touched it, the history of massacre within Soul Edge traveled into Siegfried. Siegfried felt his flesh being seared away as Soul Edge devoured his emotions. He realized too late that the sword was merging with him. He screamed as his body turned red as blood and the sword exploded with evil energy. A massive column of evil power shot up into the night sky and rained the Evil Seed down on all humanity. It was in this instant that Siegfried ceased to exist and his body became Nightmare. The next three years were spent in a dream-like state. He was vaguely aware of his alter-ego harvesting hundreds of souls to refuel the depleted Soul Edge. Little did he know that his own desires had been driving the demonic creature: Nightmare was making his way to Ostrheinsburg castle to return to the spot where his journey had begun. Once his minions had collected enough souls, Nightmare used the power of the Soul Edge to resurrect Siegfreid's father Frederick. When his "father" asked Siegfried to pierce him with his sword, Siegfried knew it was nothing more than an illusion created by his weak mind. His father admonished Siegfried for his evil actions. This finally broke Siegfried from the mental control the Soul Edge had over him. He found himself under attack by three warriors, Kilik, Xianghua, and Maxi. Their battle did not last long, as the weakened Nightmare was easily defeated by the warriors. The Soul Edge was knocked free from Nightmare's grasp, and Siegfried's body was returned to normal. As he had done many years ago, he once again fled the castle while a battle raged out front. Feeling like he had been given a second chance, Siegfried set out to make right all of the things that he as Nightmare had done. He first returned home to visit his mother, Margaret. Her life had became completely barren in the three years since she lost her husband and son. This was the first time Siegfried had been home since he murdered his father. He made his way up the walk and prepared to knock on the door when he heard his mother praying inside. He froze as he heard her pray that her son's soul may find peace. He realized that he was unworthy to see his mother at this time, that he must make peace with his soul before he could ever face her. Not wanting to leave without saying goodbye, he spoke a farewell to her and ran away before she could notice. Siegfried had now grown into a man, and he left his childhood home refreshed. With renewed vigor, he set out to put out the flames of unholy hellfire that he had spread throughout the world. He gathered together a new Schwarzwind, one devoted to the destruction of demons. The path that lay before him was uncertain, but Siegfried knew that now because his cause was truly righteous that he would prevail.