During World War II, Hitler's Third Reich sought out and pilfered art and wealth, hording their stolen booty in secret strongholds. This game takes place during that time. In 1942, special German forces have invaded Tibet and are searching for more to add to their Führer's arsenal - the 12 "miracle" weapons of King Arunja in an undiscovered "Lost City". One of these weapons, according to legend, could obliterate major cities, wiping them off the face of the earth. The player takes the part of Colonel Grom, a member of the Polish army fighting the Nazis during World War II. Grom is a seasoned and shrewd commander who has his own personal score to settle with the Germans.

GROM: Terror in Tibet is a predominantly role-playing game with elements of stealth and emphasis on tactical combat. The player controls a party of characters, navigating them through towns and other locations in a fairly linear fashion, often engaging in conversations with multiple dialogue choices. Travelling between the various locations is handled by way of a country map. Combat system has similarities to that of Baldur's Gate, with real-time management and the ability to pause in order to issue commands. Unlike in most RPGs, the characters themselves do not level up in this game; their only growing attribute is weapon proficiency, which plays an important role in combat.