Yvain was born to King Urien of Gorre, a British kingdom in the north, and to a mother variously named as Morgan le Fay, the enchantress and half-sister of King Arthur, or as Modron, a Welsh goddess-like figure linked to the Ford of Barking. His cousin was Sir Gawain, Arthur's nephew and the most celebrated knight of the Round Table. In the earliest Welsh tradition, Yvain appears as Owain ap Urien, a historical prince of Rheged who became a hero of legend. The continental romances transformed him into one of Arthur's foremost knights, a man of great prowess and greater passions, whose story begins at a magical fountain in the forest of Broceliande.

The tale opens when Yvain's cousin Calogrenant, a knight of Arthur's court, tells of a humiliating defeat at a marvellous fountain. In the forest stood a slab of marble beside a spring; whoever poured water from a silver bowl upon the slab would summon a thunderstorm, and a knight on a black charger would emerge to defend the fountain. Yvain, shamed on his cousin's behalf and driven by the fierce pride of youth, rode to the fountain alone. He poured the water, weathered the storm, and fought the guardian, Esclados the Red, a fierce knight who had never been beaten. Yvain killed him, then pursued the wounded man to his castle, where a portcullis trapped him inside. There he saw Esclados's widow, Laudine, the Lady of the Fountain, and fell in love with her at the very moment she mourned her husband's corpse. The maid Lunete, a sharp-tongued and clever servant, took pity on the hidden knight. She gave Yvain a magic ring that made him invisible, then persuaded her grieving mistress that Yvain was the only man strong enough to defend the fountain. Laudine married him, and for a time Yvain knew happiness and honour such as few knights ever taste.

Then Sir Gawain came to the castle and convinced Yvain that a true knight must seek tournament fame abroad. Laudine consented on one condition: he must return within one year, or forfeit her love forever. Yvain rode with Gawain to Arthur's court, where the tournaments were so glorious that he forgot his promise. The year passed, and a messenger from Laudine arrived to reclaim the ring and denounce him as a liar. Yvain lost his mind with grief. He tore his clothes, ran naked into the forest, and lived like a wild beast, eating raw meat and sleeping in the rain. A hermit fed him bread and water until a noblewoman of Noroison found him and anointed his body with a magic ointment that restored his wits. He repaid her by defeating Count Alier, who was plundering her lands, then rode away refusing either marriage or reward.

The most famous episode of Yvain's madness and redemption came when he found a lion fighting a fire-breathing serpent in the forest. The serpent held the lion by the tail, and Yvain drew his sword and cut the monster down. From that moment the lion became his companion, sleeping beside him, fighting at his side, and carrying him on its back when he was wounded. As the Knight with the Lion, Yvain performed deeds that restored his honour. He saved Lunete from being burned at the stake by the false accusation of a wicked seneschal, slaying the seneschal and his two brothers with the lion's help. He rescued four sons of a baron from the giant Harpin of the Mountain, who threatened to kill them unless the baron surrendered his daughter. He fought two demon brothers in a castle where the lord forced every guest to battle for his daughter's hand, and the lion broke from its confinement to save Yvain's life when he was sorely wounded. And in the most poignant of his adventures, he fought an unknown knight in a tournament to defend a younger sister's inheritance against her avaricious older sister. The combat lasted from dawn to dusk, so brutal that both men were exhausted and bleeding. When Yvain proposed a truce, he recognised his opponent's voice. It was Gawain. Neither would accept victory over the other, and King Arthur himself declared them equal in prowess.

At last Yvain returned to the fountain of Broceliande. He poured water upon the stone and summoned a storm so terrible that Laudine feared her castle would be washed away. Lunete, who had never abandoned her loyalty, spoke to her mistress with such eloquence that Laudine forgave the knight who had broken his word and then spent a year proving himself worthy of a second chance. Yvain was restored to his wife and to his castle, and the lion remained at his side. In later tradition, Yvain appears in the Vulgate and Post-Vulgate cycles and in Malory's Le Morte d'Arthur, where he is one of the last knights to fall at the battle of Camlann, fighting beside Arthur until the end. The Welsh romance Owain in the Mabinogion tells the same tale with a different voice, stripped of Chrétien's psychological commentary but retaining the same essential story: a knight, a fountain, a widow, a lion, and the long road back to honour through suffering and faithful service.