The game allows the player to design a pretender god with the potential to ultimately become the god of a fantasy world by defeating all other pretenders. The interface consists of a hand-drawn or randomly-generated world map and several menus. The maps are divided into provinces which can be conquered in tactical battles. Provinces provide gold and resources, needed to recruit units. Compared to other games in the genre, Dominions 3 only has a small amount of economic management, focusing almost entirely on creating and deploying armies.

At the start of the game, each player begins with a predetermined number of provinces, typically one. This starting province is the nation's capital, with a fortress, temple, and magic laboratory. From here, the player can recruit soldiers, commanders, mages and priests to wage war upon their enemies. Mages cast spells, forge items, summon units, conduct research and search for magical sites. Priests can preach against enemy dominions in addition to using holy spells.

Provinces that believe in the player's god are considered part of that god's dominion and enjoy several advantages: the player's troops fight better, enemy forces are penalized, and the global scales (things like temperature, magic resistance, luck, and supplies) are slowly changed to the controlling god's liking. Friendly dominion is indicated with white candles, whilst enemy dominion is shown with black candles. Should a player lose all provinces or all dominion, they will lose the game.