Sanpei is a young carefree boy that lives alone with his grandfather deep in the mountains.

One day, when Sanpei takes a nap whilst floating down the river on a makeshift raft, he is mistaken for a Kappa and gets pulled underwater by a group of 'fellow' Kappa that are worried about him being spotted by humans, before whisking Sanpei away to the underwater Kingdom of the Kappa.

Upon arrival, Sanpei is soon discovered to actually be a human and is immediately is sentenced to execution.
Realizing the situation he's in, Sanpei somehow manages to convince the Kappa elders that Human civilization is much more advanced and that they could learn a great deal from the humans should they allow him to live. Unable to trust Sanpei completely, the Kappa Elder removes Sanpei's bellybutton (as this is where they believe his soul to be located) as a guarantee before sending him back to the Human world, escorted by a young Kappa "exchange student" that strikes a frightening resemblance to Sanpei.

Thus begins Sanpei's adventures as he seeks to educate the Kappa, foil a persistent Death god, learn about his parents whereabouts, tackle angry Tanuki's, and lastly, win back his bellybutton!