Many technical changes and upgrades were made for this expansion.
The New Republic base on Altyr V is under attack from two artificial asteroids controlled by the Imperial Remnant. Kyle Katarn steals a Lambda-class Shuttle from the Imperial attackers and flies to one of the asteroids. There, he breaks into the control room and redirects the asteroid's fire to the other. With the other asteroid destroyed, he circumvents the weapon's cooling system, escaping just before the asteroid explodes. While on the artificial asteroid, he finds information on the planet Dromund Kaas, which has some importance to the Empire. He travels to the planet to investigate, leaving Mara Jade to carry out several missions for the New Republic.
Mara's first mission is to negotiate with Ka'Pa the Hutt concerning the New Republic's supplies. In order for Ka'Pa to comply, Mara is forced to steal the GCT, a device belonging to Ka'Pa's rival, Takara. While looking for one of Takara's lieutenants, Abron Mar, in the Katraasii Spaceport, Mara is trapped by Mar. She is thrown into a prison cell but manages to break out of her cell and retreat into a series of pipes. The pipes lead to the lair of a rancor kept by the pirate group. Retrieving her lightsaber from behind the cage door, she slays the rancor and escapes with the device.
Afterward, Mara is assigned to a New Republic Corvette guarding a Jedi Holocron. The ship is attacked by the Lumini Pirates, a group led by a smuggler named Kaerobani. Mara repels the attackers, but the Holocron is stolen. Mara stows away in a cargo container and infiltrates the pirates' ship. The ship carries her to Rathalay, where she reclaims the Holocron and escapes.
With Kyle having been absent for quite some time, Mara travels to Dromund Kaas to find him. The planet's dark side aura leaves Mara's weapons useless, except for her lightsaber. Fighting her way through a large swamp, she reaches the Dark Force Temple. There, she encounters Kyle, totally maddened by the dark side. Mara and Kyle duel several times, Mara as the victor. Kyle retreats deeper into the catacombs, finally reaching the temple's throne room. Mara pursues Kyle, finally confronting him inside the throne room. Mara then voluntarily turns off her lightsaber and leaves herself open to Kyle's attack. Kyle is unable to kill Mara and rejects the dark side.
Realizing his mistakes, Kyle let his Force powers atrophy. Turning his back on the Jedi way, he returned to his mercenary life on behalf of the New Republic with his long time partner, Jan Ors.
This expansion significantly improved the original Jedi Knight engine by adding aesthetic features such as colored lighting, new enemies and Force powers (and more controversially, doing away with the Dark/Light side duality). There were several under-the-hood changes as well, the most significant being that COG, the programming language that Jedi Knight uses to create scripted in-game events and interactivity (doors, elevators, weapons, in-game cutscenes, enemy behavior, and many other things in Jedi Knight are controlled by COG scripts) was expanded with new functions and capabilities, which the Sith Engine took full advantage of. In addition, while enemies in Jedi Knight would run away if stripped of their weapons, in Mysteries of the Sith they would attempt to fight with their fists. Mysteries of the Sith also featured new types of multiplayer action such as the gamemode KFY ("Kill the Fool with the Ysalamiri") based on KFC, and included several new weapons. A few Force powers such as Throw and Lightning were replaced as well.
The game has a hidden level which allows the player to take the role of Luke Skywalker during his visit to Bespin in Star Wars: Episode V The Empire Strikes Back. The LucasArts web page containing this information was well hidden with no pages linking to the required files. Discovery of this page spread by word of mouth.
For some users, the "episode.jk" file downloaded as "episode.txt"; renaming "episode.txt" to "episode.jk" solved the problem.