Originally forged by Naga from one of her fangs, she used it to seal away the Earth Dragons, who had gone wild and were threatening to destroy humanity. After her death the shield was stolen by a thief named Adrah, who removed and sold the gemstones placed in it, thus unknowingly weakening the seal over the Earth Dragons. The thief would later go on to found the kingdom of Akaneia and kept the shield, now renamed the Fire Emblem, as a royal treasure. During the battle against Medeus and the Doluna Empire, the Fire Emblem was wielded by Duke Cartas, leader of the rebellion against Medeus, although it was ultimately the peasant born Anri, wielding the Falchion, who would slay Medeus.
Sometime after the Shield of Seals became the Fire Emblem, a curse was put on it, dooming its wielders, who for most of its history was the Akaneia royal family, to misery. There are two different origins given for the curse: Mystery of the Emblem implies the curse began when Adrah stole the shield and removed the orbs, while Shadow Dragon implies that the curse originated with Artemis, who cursed it in order to guarantee Cartas victory in battle only to have it backfire on her and doom her relationship with Anri.
The shield remained in Akaneia until Medeus's revival, where the surviving member of the Akaneia royal family, Nyna, entrusted it to Marth to use in his battle against Medeus. In Mystery of the Emblem, Marth would obtain the shield once again, this time from Linde, when he began his battle against the possessed Hardin. He would eventually find the missing orbs and have Gotoh restore the Fire Emblem to its true form, the Shield of Seals. With the Shield of Seals and the Falchion, Marth was able to slay a revived Medeus.
The Fire Emblem is one of the national treasures of Ylisse, alongside the Falchion. The Fire Emblem was used by the first Exalt of Ylisse to defeat Grima, but due to the Emblem's overwhelming power, four of the jewels were removed from it afterwards. When all five jewels (Argent, Sable, Gules, Azure, and Vert) are placed on the Emblem, the Awakening Ceremony can be initiated. The Fire Emblem is also used as a shield by Chrom when he is promoted to Great Lord, similar to how Marth uses it in Mystery of the Emblem. Its alternate appearance in this title is explained by Lucina in a support conversation; both the Fire Emblem and the Falchion were broken and reforged some time before the game.
The five gems of the shield were distributed across the world in the various countries during a time known as the Schism. Ylisse held onto the shield itself as well as the the silver gem, Argent. Ferox held the red jewel, Gules, Tiki held the blue jewel, Azure, in the Mila Tree, Chon'sin held the green jewel, Vert, until it was taken to Valm after Walhart conquered Chon'sin, and the black gem, Sable, belonged to Plegia.
The Fire Emblem is used by Marth to open chests without a key. After it is upgraded into the Shield of Seals it gains the ability to repel Earth Dragons. Contrary to popular belief, it is not needed to wield the Falchion, although Marth and Chrom both wield the two together. The shield also gives Marth +2 for all his stats in Shin Monshō no Nazo once all the Gems have been Replaced. In Awakening, Chrom wields it, although it has no gameplay effect.
The name Fire Emblem most likely refers to the fact that In Mystery of the Emblem, Shadow Dragon, and Shin Monshō no Nazo, the Shield depicted a Phoenix bearing five Orbs, the Orbs themselves being absent until near the end of Mystery of the Emblem and its remake. A Phoenix is a creature that when near death catches fire and is later reborn from its own ashes, somewhat akin to the Shield's own vandalism and restoration.
In Awakening, after the Fire Emblem is taken from Chrom by Validar. If Chrom is a Great Lord, the Shield of Seals no longer appears on his arm until he retrieves it. Likewise, if he promotes to a Great Lord before receiving the Fire Emblem in Chapter 7, it will not appear on his arm. Despite the developers taking this into account, Chrom's map sprite always has the shield.
The English names of the gems in Awakening are based off of tinctures used in heraldry.
In Fire Emblem: Fates, the Shin Monsho no Nazo's version appears as a special clothing that can be equipped on all units via My Castle.