Baldur's Gate: Dark Alliance is a real time hack and slash Action role-playing game presented in a true 3D perspective correct rotatable third person overhead view. The battle system in the game is simplistic but flexible. Character statistics at the game's beginning are preset, and the player may only customize their character's stats through gaining experience points. Experience points are gained by winning battles, and at specific levels the character gains new ability points to spend on enhancements specific to the character class. The ability choices affect the fighting style of the character.
Gameplay is linear, and any current quest must be completed successfully before the story proceeds. There are also relatively few non-player characters (NPCs), of which only those who are part of a quest or side-quest may be interacted with. There are not that many sidequests available in the game, but those available - such as for Keaira and Ipswitch - help players to gain experience and level up. Weapons, armor and items are only available for purchase from one location at a time in the current region, and are increasingly valuable later in the game.
The game's ruleset is based on a limited set of 3rd Edition Dungeons & Dragons rule-set; compared to other D&D Games there are relatively few rules implemented in the game. There are four playable classes: Human Arcane Archer, Elven Sorceress, Dwarven Fighter and Drow Ranger. Gameplay strategy is different for all characters: the human relies on ranged attacks and stealth, the elf character can cast magic spells, and the dwarf is an all-around fighter. Through updating each character, the characters go to mimic characters of other classes.
A local co-op mode is available, which uses a single non-split screen view. The second player can select one of the unused characters.