Grenadier follows the travels of the buxom and beautiful Rushuna Tendō, an expert senshi, and the samurai Yajirō Kojima, a mercenary swordsman. A Senshi or "Enlightened" is one who is skilled to some degree in the use of guns. The series begins with Yajirō and a small army of samurai launching a frontal assault against a fort in an attempt to free their lord, which was taken over by a group of gunners. The assault fails.

Yajirō orders a retreat, but is spotted by the enemy and chased to a small cliff, which he jumps off of to escape. With his pursuers still following, he follows a nearby hot-water stream upcurrent where he finds Rushuna bathing in a hot spring. She seems undisturbed by his presence or her own nudity and hides him in the hot spring with her amplebreasts as cover until the enemy passes them by. After this, she introduces herself as a traveler and reveals the ultimate battle strategy to Yajirō; to avoid battle by removing an enemy's will to fight.

Hearing the gunfire of the renewed assault upon the fort, Yajirō leaves Rushuna to rejoin combat. He arrives in time to see the leader of the gunners use a Gatling gun to decimate the samurai. Rushuna also arrives at this point and shows her considerable gun talent and effectively ends the battle by defeating the lead gunner and rescuing the lord by herself.

Something in him changing, Yajirō decides to become Rushuna's partner and travel with her.

During their travels, Rushuna and Yajirō face a mysterious masked figure known only as "The Jester" who is responsible for a weapon called "Enlightened Evil". Then they discover that Tenshi, who sent Rushuna to travel in order to learn the "Ultimate Battle Strategy", had apparently put a price on her head. Joined by a young girl named Mikan Kurenai, a balloon maker, Rushuna and Yajirō make their way to the capital of Tento. Along the way they overcome many of the Juttensen, Tenshi's elite personal bodyguard.

When the three reach Tento they discover the truth and the final showdown against the Jester begins.