Tsukuyomi was the sword of Nagi and he used it to slay the True Orochi. Although their battle seemed fruitless and Nagi was almost bested, he was instilled with a new found power when Shiranui howled at the sky and summoned the moon. This allowed him to then slay the Orochi and use the sword to seal him away in Moon Cave However, Susano removed it from the shrine, 100 years later, in order to try and prove that the myths about his ancestors are false. However, as the myths were true, the Orochi was set free to curse the lands, thus forcing Sakuya to revive Amaterasu from her statue. In a frightened haste, Susano dropped the sword and ran for his life. The Orochi then consumed the sword to prevent it from being used to seal him away again.
Susano then freed the sword from the belly of the beast when Kushi was chosen as the sacrificial maiden. Much like Shiranui helped Nagi, Amaterasu howled at the sky and summoned the moon with Crescent to grant Susano incomprehensible strength. His sword glowed gold and he was able to decapitate all of the Orochi's heads and defeat him once again.
Once the Orochi is destroyed, the sword reappears however it has been reborn into Tsumugari and is imparted onto Amaterasu as a Divine Instrument.
Tsukuyomi takes its name from the Shinto Moon God of the same name. Tsukuyomi was also the brother of Amaterasu and Susanoo.
The hilt of Tsukuyomi has a crescent moon on it that reflects what it is based on.
The fact that Susano retrieves the sword from the Orochi is a reference to how Susano-o of Japanese myth obtained the Kusanagi-no-Tsurugi, or "Grass Cutting Sword", when he bested the Orochi.
- After defeating the Orochi, Susano refers to the sword as Bokunenjin instead of Tsukuyomi.