In Final Fantasy IV, the player controls a large cast of characters and completes quests to advance the story. Characters move and interact with people and enemies on a field map, which may represent a variety of settings, such as towers, caves, and forests. Travel between areas occurs on a world map. The player can use towns to replenish strength, buy equipment, and discover clues. Conversely, the player fights monsters at random intervals on the world map and in dungeons. In battle, the player has the option to fight, use magic or an item, retreat, change character positions, parry, or pause. Certain characters have special options. Player characters and monsters have HP or hit points (represented by a numerically based life bar); attacks reduce hit points until none are left, at which point the character faints or the monster dies. If all characters are defeated, the game must be restored from a saved game file. The player can restore the characters' hit points by having them sleep in an inn or use items in the party's inventory, such as a Potion. Equipment (such as swords or armor) bought in towns or found in dungeons can be used to minimize received damage or increase damage inflicted on monsters. The player can choose whether characters appear on the front line of a battle or in reserve. A character's placement impacts distribution of damage received and inflicted. The game's story is linear—the player can usually advance the game through only one path, although limited side quests are available.

Final Fantasy IV introduced Square's Active Time Battle (ATB) system, which differed from the turn-based designs of previous RPGs. The ATB system centers around the player inputting orders for the characters in real time during battles. An important precedent, ATB was used in the five subsequent Final Fantasy games, Chrono Trigger, and Final Fantasy X-2. Each character is balanced through certain strengths and weaknesses; for instance, a strong magic user may have low defense, while a physical fighter may have low agility. Like other Final Fantasy games, characters gain new, more powerful abilities with battle experience. Magic is classified as either "White" for healing and support; "Black" for offense; or "Summon" (or "call") for summoning monsters to attack or or carry out specialized applications. A fourth type—"Ninjutsu"—consists of support and offensive magic and is available to only one character. Magic users, who account for eight of twelve playable characters, gain magic spells at preprogrammed experience levels or fixed story events. The developers have balanced point gains, items, and rewards to eliminate long sessions of gaining levels. Due to the Super Nintendo's greater processing power, Final Fantasy IV contains graphics improved over past Final Fantasy titles and concurrent Super Nintendo games. The game employs the Super Nintendo's Mode 7 technology to give enhanced magic spell visuals and to make airship travel more dramatic by scaling and tilting the ground for a bird's eye view.

Most of Final Fantasy IV takes place on Earth, also known as the Blue Planet,• which consists of an Upper World and Underground. The Upper World consists of territories populated by different character classes from the series. The Underground is primarily inhabited by dwarves and is covered in rock and magma. A red moon orbits the planet, upon which people called the Lunarians and Hummingway live. Travel between the three realms is accomplished through airships.

Final Fantasy IV offers twelve playable characters, each with a unique character class. The protagonist, Cecil Harvey, is a Dark Knight of Baron who serves the king alongside his childhood friend Kain Highwind. Kain was once asked to become a Dark Knight, but instead followed his father's example and became a Dragoon. Rosa Farrell is Cecil's girlfriend; she became a white mage and archer to protect a Dark Knight as her mother protected her father. Cecil is the captain of the "Red Wings", an elite air force unit constructed by his friend, the engineer Cid Pollendina.

During his quest, Cecil is joined by others. Rydia, the first, is a young Summoner from the village of Mist. Cecil gains her trust by saving her life. Tellah is a legendary sage of Mysidia; he is very protective of his daughter Anna. Edward Chris von Muir, the prince of Damcyan, pursues her courtship and travels disguised as a bard. Yang Fang Leiden is the well-mannered head of the Monks of Fabul. Palom and Porom are twin wizards from Mysidia who assist Cecil in a difficult trial. Edward "Edge" Geraldine is the rowdy Ninja prince of Eblan who has a crush on Rydia. Lastly, FuSoYa is the guardian of the Lunarians during their long sleep.