Ling Xiaoyu is a young and talented martial artist who dreamed of building the perfect theme park in China. Her teacher and distant relative, Wang Jinrei, told her about Heihachi Mishima, owner of the wealthy and resource-rich Mishima Zaibatsu.[10] Xiaoyu wished to seek him out to make her dream a reality, but was unsure how to get to Japan. Her chance came when she was on holiday with her family in Hong Kong. She left her family and stowed away on a yacht marked with the Mishima Zaibatsu's name. She was discovered by the staff on the yacht after they left port, and Heihachi Mishima was alerted to the situation.

When Heihachi arrived, he discovered that Xiaoyu had beaten up his staff. She approached him and threatened to fight him too. Amused, Heihachi promised to build her theme park if she won the King of Iron Fist Tournament 3.[11] Xiaoyu became a ward of the Mishima Zaibatsu.[12] She began attending the Mishima Polytechnical School and befriended Heihachi's grandson, Jin Kazama.[13] She also has a panda bodyguard who doubled as a good friend.[14]

Xiaoyu did not win the tournament. She continued to attend school, but grew bored of her daily routine with her theme park ambitions out of reach. One day, she received an anonymous email warning her that Heihachi Mishima had evil intentions and that she may be in danger. Xiaoyu suspected that the email had been sent by Jin, who had disappeared without a trace at the close of the tournament. She began to distrust Heihachi. When the King of Iron Fist Tournament 4 was announced, Xiaoyu entered in hopes of being reunited with Jin, and to unveil the truth behind Heihachi Mishima and the Mishima Zaibatsu.[12]

During the tournament, Xiaoyu was rescued by Yoshimitsu.[15] He told her about the Mishima Clan's history, and Xiaoyu began to believe that the family's misfortunes could be traced back to Heihachi's cruel upbringing of his son, Kazuya Mishima.

Upon hearing news of Heihachi Mishima's supposed death, Xiaoyu became upset. She began to wish that she could turn back time to make things right. Some time later, she met a scientist who claimed he would be able to make a time machine for her, albeit for a high price. Xiaoyu entered the King of Iron Fist Tournament 5 with the intention of winning the prize money to finance her time machine.[16]

Xiaoyu did not win the prize money. She was relieved to learn that Heihachi Mishima was alive, but discovered that Jin, who had won the fifth tournament and gained control of the Mishima Zaibatsu, was planning to kill his grandfather. She wanted to persuade Jin to stop, but was unable to approach him due to the Mishima Zaibatsu's military build up. When the King of Iron Fist Tournament 6 was announced, Xiaoyu entered in hopes of getting close to Jin to make him change his ways.[17]

Though Xiaoyu was unable to make contact with Jin during the sixth tournament, she persisted in trying to reach him. After learning of Jin's disappearance, she infiltrated the Mishima Zaibatsu in search of information. During her mission, she was confronted by a man dressed all in white, and challenged him over his refusal to let her proceed.[18]

Whilst initially Claudio had intended to use Xiaoyu as bait to get to Jin, he was impressed by her devotion to him, and, when the credibility of his organization fell apart, decided to reveal his previous ulterior motives to her, and instead help her.[19]

For six months, Xiaoyu traveled all over the world with Panda,[20] looking for clues and information on how to find and help Jin.[21] Eventually, Xiaoyu and Claudio discovered Zafina after she collapsed, and Xiaoyu attended to her while Claudio placed a seal on Zafina's arm. Zafina told them of her situation, and the three began working together.[22]

When Xiaoyu heard Zafina and Claudio discussing how they might assist Jin in the fight against Kazuya Mishima, she insisted on going with them to the coliseum in which the King of Iron Fist Tournament 8 was being held to assist however she could.[23] Zafina told Xiaoyu that Jin was going to face great difficulties, and he would need her to protect him.[24] The trio traveled to the coliseum and entered it as Yggdrasil and the United Nations' forces began their own operation there. Amidst the chaos, Zafina was captured by Kazuya, who expelled Azazel from her, leading her to become gravely wounded. Xiaoyu and Jin both went to Zafina's assistance, reuniting in the process.[25]

Xiaoyu joined Jin on his journey to Yakushima, where he was indirectly told to go by Zafina. As they made their way towards a clearing where Jin and his mother had routinely sparred in the past, Xiaoyu engaged Jin in conversation about what they had wanted to grow up to be; her reveal of her childhood desire to build and run her own theme park made Jin smile. When they reached the clearing, Xiaoyu suggested that she and Jin spar, believing this might reveal the path forward for Jin. After their fight, Xiaoyu noted that, though Jin had changed in the years they'd been apart, he was still the same person she'd always known and loved. Jin was then drawn to a sanctum by a lullaby only he could hear. He faltered as he progressed further into the sanctum, and Xiaoyu became concerned for him. Before losing consciousness, Jin promised Xiaoyu he would return.[26]

Xiaoyu watched over Jin while he was unconscious. When waves of Jack-7 androids located them, she fought them off to keep them from getting to Jin while he was vulnerable.[24] After some time, Lars Alexandersson found her and the waves of Jack-7 robots stopped coming. However, they were found by Devil Kazuya, who intended on killing Jin. Injured and exhausted from her fight with the Jacks, Xiaoyu watched from the sidelines while Lars fought Kazuya.[27]

Finally, Jin awoke in a benign version of his devil form, having reconciled with that part of him while he was unconscious. He saved Lars from one of Devil Kazuya's lasers and then regrouped with Xiaoyu. She told him she wasn't afraid of him even in his devil form, and asked him not to die in his fight against Devil Kazuya.[28]Jin went on to defeat Kazuya[29] and purify himself of his Devil Gene.[30] Xiaoyu and Jin went on to go traveling in America.[29]