Nioh is an action role-playing game set in Japan during the year 1600, with players taking the role of an Irish samurai named William. The player guides William on missions through enclosed environments fighting both human enemies and supernatural beings called yokai: missions are self-contained, hold alternate routes William can navigate, and selected from a menu rather than reached by navigating an open world. While navigating environments, William can find various collectibles both in crates scattered through the environment and in other places within the environments such as fallen soldiers. These collectibles include Amrita, the game's experience points (EXP); gold, the in-game currency; new weapons and armor, and consumable items such as bombs. Weapons and armor found in the environment can be taken to a blacksmith, who is able to buy it from William or can break it down into base material. Shrines scattered through levels act as checkpoints, allowing players to save progress, replenish health and raise William's experience level through accrued EXP: doing this respawns all normal enemies within an area. Skill points acquired in combat are assigned at shrines.
Fighting is based around a mix of Dark Souls-inspired combat and fast-paced hack and slashes combat (similar to previous team ninja works), with William being able to attack enemies and block their attacks in turn. William can run, dodge, and sprint with these and combat actions draining his Ki stamina bar. When his Ki has been depleted, William is left vulnerable to attack. If timed right, William is able to replenish lost Ki with an action called "Ki pulse". The Ki pulse also grants status buffs onto William and dispels patches of miasma generated by yokai and other supernatural enemies which rapidly saps Ki. Defeated enemies drop loot, which includes money and weapons. The speed at which William can move through levels depends on the weight of his equipped armor; the heavier it is, the faster his Ki will drain. If William dies, all the EXP acquired up to that point is left where he fell, and he must travel back to retrieve it, but if he dies again and therefore failing to reach it, the amount of EXP dropped is lost and the spirit animal is automatically recovered.
William has access to multiple types of melee weapons: these include single and dual swords, axes, polearms, and kusarigama. In addition to melee weapons, William has access to ranged weapons such as a bow, a rifle, and a hand cannon. The more each weapon is used, the stronger and more effective it becomes. In combat, William can change between three Stances with melee weapons, with each stance having different effects; High Stance causes higher damage while lowering defense, Low Stance allows for quick attacks and better defense, while Middle Stance balances elements of the other two Stances. These Stances also consume different amounts of Ki depending on their attack strength. William can also summon Guardian Spirits, animals that combine his health and Ki into a single meter with added stat boosts such as increasing attack power or defense. Each Guardian Spirit boosts different stats, and can only be switched out at shrines. Guardian Spirits are also lost when William dies, but they can be summoned to him at a shrine at the cost of his lost EXP. In addition to normal enemies, William can summon Revenants, hostile ghosts based on other fallen players, to battle and gain experience, money, and items. A cooperative multiplayer allows for other players to be summoned to help in battles.