The script can be read here but below is a synopsis.
Eric, Bobby and Uni are navigating the pitch blackness inside the Tower of Darkness. Eric instructs Bobby to knock down the door but instead he knocks a hole in the wall beside it as he cannot see anything. Eric is carrying the Box of Balefire. The tower collapses from the blow just as the trio run to the campsite where their other four friends are. Curious, Eric wants to know what is inside the box despite Dungeon Master instructing them to find it but not to open it. Dungeon Master appears and orders him to move away from the casket but there is a monstrous groan from inside and the lid flips open sending out a column of blinding light before a startled Eric can lock it. A mortified Dungeon Master closes and locks the casket, explaining that it was a beacon to a powerful entity. A gale begins.
Shadow demon reports to Venger's castle and tells him that the heroes have retrieved and opened the Box of Balefire. He too is mortified but wants to survive the oncoming events to punish the heroes.
Dungeon Master has the heroes bury the Box of Balefire before battling against the gale to flee the ruins.
A massive column of smoke and fire that crackles with lightning sweeps across the land towards Venger's castle, incinerating everything in its path. Reaching the castle it stops and communicates with Venger who welcomes it as his master but denies having failed and deserving no punishment. This entity is the Nameless One that was summoned by the Box of Balefire.
Still fleeing through the gale Presto tries to summon something from his hat that will help but only manages a set of highway safety flares, an emergency radio with no batteries along with a vacuum cleaner, megaphone, torch, telephone, Swiss army knife and bicycle helmet among other things. Finally producing a copy of Ranger Fred's Guide To Survival In The Amazon he gives up just as the Nameless One approaches. Dungeon Master explains that this entity is evil incarnate and teleports himself and the heroes to temporary safety upon a mountain, although the effort fatigues him. Moments later the Nameless One approaches and Dungeon Master teleports them all back to the ruins where the Tower of Darkness once stood before almost collapsing. As the Nameless One continues his approach a solemn Dungeon Master seems resigned to die but when the heroes plea with him to do something he drains the magic from their totems to deflect the Nameless One's beam of energy. He seemingly fails and the Nameless One moves on leaving a scorched crater were they once stood.
The heroes arrive in the caverns of the Underworld but without Dungeon Master. Hearing a sinister chuckling sound they try to defend themselves with their totems but they do not work, having been drained of their magic in defending against the Nameless One. A weakened Dungeon Master stumbles out of a nearby passageway and fade in and out of reality, explaining that both he and the totems are depleted. To replenish both himself and the totems they need to travel to the Dungeon at the Heart of Dawn. Fortunately the Nameless One thinks they are dead and will not pursue them. Shadow demon overhears this discussion.
Shadow demon reports back to Venger who also escaped the Nameless One by teleporting into the Underworld but he his magic is also depleted. He wants to reach the Heart of Dawn before the Dungeon Master and the heroes do.
At the Plains of Fire Dungeon Master and the heroes are crossing a narrow ledge along a cliff face when a boulder falls on them. Dungeon Master's magic fails to repel it and the effort makes him fade in and out of reality again. As the boulder strikes Presto looses his footing and falls onto an unreachable ledge further down. Unable to rescue him the group decide to continue.
Venger throws a rock at an obelisk which chimes like a gong and summons giant salamanders from a nearby lava stream who proceed to attack the heroes. Breaking a branch off a nearby petrified tree as a makeshift staff Diana remains behind to fight the monsters while the others flee.
Meanwhile Uggar is scolding fellow slave goblins about the quality of stone when Venger appears saying he has a task for him. Uggar seems unimpressed and doubts whether Venger has sorcery enough to enslave him and the other goblins in the Underworld but when threatened with a display of power relents.
Opening a door the Dungeon Master and the heroes arrive at a massive staircase that spirals down but encounter a purple worm who is the guardian. It smashes part of the stairwell stranding Eric while the others continue downward where the glow from the Heart of Dawn can be seen. But before they can go any further Venger appears with Uggar and his fellow goblins spearheading an attack. Venger knocks Hank unconscious with a mystic bolt and Uggar incinerates Bobby's club with beams from his horned helmet. The goblins surround Bobby and Uni while Uggar and shadow demon pursue Sheila, grabbing her cloak and ripping it. Dungeon Master collapses and fending off one of Uggar's beams with magic vanishes from the effort.
Cut to Eric cowering from a rearing purple worm, Diana surrounded by giant salamanders and Presto clinging to his crumbling ledge.
Dungeon Master fades back again and begins crawling towards the Heart of Dawn. Venger hauls up a now conscious Hank and gloats over his winning situation but despairs when he spots the Dungeon Master who reaches the font and sinks below its waters, emerging briefly as a giant crystal before metamorphosing back into his normal self. He teleports Presto, Diana and Eric to him and away from danger and recharges the heroes' totems. Hank shoots an energy arrow that binds Venger who nevertheless gloats that they are all trapped in the Underworld together. Dungeon Master disagrees and gathers the heroes around him ready to teleport up into the Realm and confront the Nameless One. He recharges Venger's sorcery too and asks him to join the battle. Reluctantly Venger does out of pride but upon returning they find that the Nameless One has left the Realm to terrorize another world. An ungrateful Venger teleports away with shadow demon, vowing to continue his vendetta against them another day.
Michael Reaves stated that The Dungeon At The Heart Of Dawn was the second part of a trilogy exploring the dynamics between Venger and the Dungeon Master. The first and third parts being The Dragon's Graveyard and Requiem.