"Hōzuki no Reitetsu" is set in the afterlife, specifically within the bureaucratic structure of Hell, where demons and other supernatural entities manage the souls of the deceased. The series centers on Hōzuki, the chief deputy to King Enma, the ruler of Hell. Hōzuki is a calm, calculating, and highly efficient demon who oversees the day-to-day operations of Hell, ensuring that justice is meted out to souls according to their sins. His meticulous nature and dry wit drive much of the narrative, as he navigates the complexities of Hell's administration while dealing with eccentric colleagues, troublesome subordinates, and occasional diplomatic challenges from other realms.

The plot unfolds through episodic arcs, often blending dark humor, satire, and cultural references. Hōzuki frequently encounters problems that require creative solutions, such as managing unruly demons, resolving disputes between departments, or addressing the inefficiencies of Hell's outdated systems. One recurring theme is his rivalry with the flamboyant and chaotic demon Shiro, who often disrupts Hell's order with his antics. Another key character is Momotarō, a human hero from Japanese folklore who occasionally interacts with Hōzuki, adding a layer of cultural commentary and humor.

The series also explores the relationships between Hell and other mythological realms, such as Heaven, the animal realm, and the human world. These interactions often highlight the absurdities and contradictions of bureaucratic systems, both in the afterlife and by extension, in the real world. Hōzuki's interactions with King Enma, who is portrayed as a somewhat childish and capricious ruler, further emphasize the challenges of maintaining order in a chaotic environment.

Throughout the series, Hōzuki's stoic demeanor and sharp intellect are contrasted with the often absurd and surreal situations he faces, creating a unique blend of comedy and philosophical undertones. The narrative frequently incorporates Japanese folklore, mythology, and historical references, offering a rich tapestry of cultural context that enhances the storytelling. The episodic structure allows for a wide variety of scenarios, from lighthearted comedic moments to more introspective explorations of justice, morality, and the nature of punishment.