Just south of the farm is the seaside town of Alvarna, which has a variety of locations, including shops, houses, and other facilities. The player has a diary that they can use to save their progress, and a mailbox from which the player may occasionally receive mail. The player's house has the basic amenities, including a refrigerator, a bed, a table, and others.

The main area is the player's farm, where they do most of their farming and living in.

Items harvested from livestock kept in barns can be sold for money or used to cook. While exploring, the player can fight monsters to increase their strength, or befriend them and keep them as livestock, farmhands, or as battling companions. A specific tool is usually required for every task some tools can also be used as weapons. The player's skills include basic tasks such as farming, fighting, and mining, and they level up as the player carries out these tasks. These battle statistics can be improved either by defeating enough enemies to level up or by equipping a particular weapon or piece of equipment. The former show how well the player can execute a certain task, while the latter are standard role-playing game statistics. The player character has two types of statistics: ability statistics and battle statistics. The child is unable to marry, but can conduct a 'love ceremony' instead. When the Love Point total reaches ten, the player can then marry the character and raise a child, who becomes the second protagonist. While every NPC has 'Friend Points' that can be increased by visiting them and giving them items, seven female characters also have a statistic called 'Love Points' that increases as the player shows them affection. In addition, cut scenes occur at certain points in the storyline. The player interacts with objects and townsfolk through dialogue similar to a visual novel, including representing the townfolk with anime-styled images to narrate the story. Plants can be grown in certain areas outside the farm, where the climate is unchanging however, these areas must be watered by the player, and usually contain enemies. For the most part, each plant may only be planted in one particular season, and if, for example, a spring plant is in the ground during summer, it will die. Once the seeds are sown, the player must water them daily, and after several days of growing, they will be able to be picked and either sold, given away, eaten, or stored. In the beginning of the game, the player is given a farm littered with rocks, stumps, and various objects littered throughout. Each type of seed has a different growth rate and cost, and some plants can be harvested multiple times. The player begins with two tools, the hoe and the watering can, allowing the player to till the land and grow various plants after the player purchases or obtains seeds. The weather varies from day to day - while it is typically sunny, there are occasional rainy days, and, rarely, storms might damage crops and force the player to stay indoors. All four seasons are included, though there are only 120 days in the year, with 30 days per season. The game runs on its own clock and calendar while the player is outside, one in-game minute passes every second. Rune Factory 2: A Fantasy Harvest Moon has gameplay similar to its predecessor. The bottom screen of Rune Factory 2: A Fantasy Harvest Moon shows the protagonist battling an enemy in a cave, while the top screen shows a map of the location.

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