The Fellowship of the Tama
There once was a sacred jewel called the Shikon no Tama. It had great power and was constantly sought after by youkai, humans, and hanyou alike, all of whom would use its awesome power for themselves. Even those with good intent would fall to evil under the influence of the jewel's wicked taint.
Youkai seek after it to gain more power hoping to conquer Middle Earth and proclaim themselves superior. Humans seek the jewel for their own greedy purposes. That rare breed which is neither one nor the other seek it so that they can become whole.
Soon a war began, and an evil entity emerged. A hanyou named Naraku raised an army of lower class youkai. Higher youkai and certain upper class humans retaliated. The humans fought for the preservation of themselves and their land. The youkai fought for the jewel itself, which was now in Naraku's possession.
There was a certain inu youkai, who was a lord over a small land, went up against Naraku. He fought bravely, but Naraku possessed the jewel and he quickly defeated the inu youkai, breaking the inu's sword, the Tokijin, in the process. The inu's son, Inutaisho, was nearby and once he saw his father slain he attacked Naraku.
As he fought Naraku, he fell to the ground, losing his sword. He saw the broken Tokijin lying nearby and as Naraku was about to deal the death blow, he grabbed the remains of Tokijin and plunged it into Naraku's chest. He struck Naraku where the Shikon no Tama was embedded in his body, and the jewel fell out of Naraku. Although Naraku wasn't killed he was mortally wounded, and without the jewel to heal him, he had to retreat.
When Naraku disappeared, so did his army, leaving the Shikon no Tama in the hands of Inutaisho. A miko named Kikyou approached Inutaisho, beseeching him to give her the jewel, so she could purify the taint it held within. Inutaisho accused her of being a weak, greedy human, and refused to give her the jewel.
Inutaisho went on to greatly extend his father's lands until he was a very great lord known as 'the White Dog'. He also made a treaty with the human rulers of Rivendell, which was very rare for a youkai. It is said that he even fell in love with the lord's youngest daughter. With the aid of the jewel he was powerful indeed, but as was always the case with the evil gem, the great youkai fell to tragedy.
One day a great dragon demon named Ryuukotsei sought out Inutaisho, wanting the jewel for himself. Even with the Shikon no Tama, the White Dog was overpowered and greatly injured. He was just able to seal away Ryuukotsei near the border of Mordor before he died of his wounds.
His faithful servant, Jaken, found his body; and though Inutaisho had meant for the Shikon no Tama to go to his first-born son, Jaken took the jewel and disappeared with it.
Many years later a middle-aged miko named Lady Kaede of the Shire stumbled onto Jaken's lair. By this time Jaken had become obsessed with the jewel. Lady Kaede recognized the jewel as evil not realizing the true extent of its power and importance.
She used her miko skills to cloak the jewel in a veil of concealment. She then took the jewel back to the Shire with her to hide it from those who would use it until she could learn how to purify it.
Little did she know the only one who had the ability to purify the Shikon no Tama had yet to be born.