In Deluded Mind, the player assumes the role of protagonist Dean Catrall, an FBI agent, whose daughter was killed in a revenge killing, assassinated by a criminal organization. Despite experiencing tragic loss, the FBI agent continues his search for the drug dealer, after an arrest warrant has been issued. His good friend and colleague, Robert Page, accompanies him on the job. In the apartment of a drug dealer, Dean Catrall and his partner make a terrible discovery - they find a young woman dead inside. They haven't realized that the criminal had been informed through an internal source - a leak - about the warrant and this information is used to prepare an ambush. In a graphically complex scene of Deluded Mind, Dean Catrall and his partner are ambushed and immobilized.

After this heart-stopping key scene, the player finds himself imprisoned in a cell of an abandoned mental institution, where he slowly regains consciousness. In his cell, Dean Catrall finds a note, referencing the location of his partner, Robert Page. In addition, the player learns through this note that a strong hallucinogen was administered to him, which literally puts him through hell on earth, making it nigh impossible to distinguish what is real and what is not.

By using motion capture, fantastically realistic results can be achieved in character animation. The use of professional voice actors increases the quality of the gameplay significantly. The player feels immersed in Deluded Mind, is personally addressed and can thus can easily empathize with the events and happenings within Deluded Mind. The realistic sound design also contributes actively to the overall atmosphere of the game; the player will always have the feeling that he or she is not alone.