This Shadow Blot was created after the Blot was trapped in the Thinner Bottle atop Mickeyjunk Mountain by Oswald and Ortensia. Unfortunately for Wasteland, the seal was not completely sound, leading to drippings of the shadow creature to escape the entrapment. These drips formed into Blotlings. The largest of these was a "shadow" Blot, who was subsequently the most powerful and often mistaken for the real Blot.
The Shadow Blot then took over the real Blot's role as leader of the lesser Blotlings, and eventually usurped power from Oswald. Seeing that this new entity would help him achieve his goals, the Mad Doctor allied himself with the new ruler, abandoning the now-alone Oswald. The Shadow Blot then resided for a period of degeneration in the ravaged Wasteland.
At the beginning of the game, the Shadow Blot somehow travels through Yen Sid's mirror to Mickey Mouse's world (with his lower half still chained to the Wasteland), and drags Mickey into the retired cartoon world. With the help of the Mad Doctor, the Shadow Blot attempts to steal Mickey's heart to permanently free his master (the real Shadow Blot). The plan fails, however, when Mickey escapes the bonds holding him. The Blot immediately gets between the mouse and the Mad Doctor, but flees when Mickey raises the magic paintbrush.
For most of the game after this, the Shadow Blot works behind the scenes, organizing and commanding the Blotling army. This remains the case until Mickey and Oswald gather the parts for a rocket to escape Wasteland. It is then that the blotling Shadow Blot leads the entire Blotling army up Mickeyjunk Mountain, as a full-scale attempt to free their master. Mickey, Oswald, and Gremlin Gus meet the challenge, scaling the mountain to strike down the freeing of the Shadow Blot's master. As Oswald desperately tries to keep the bottle prison corked, Mickey faces the Shadow Blot in battle at the summit.
If Mickey decides to battle the Blot with Thinner, the Blot melts away, clawing at the ground as he fades.
If Mickey chooses paint as his weapon, the Blot rises into the air and blows all of the paint off of himself in an energy burst and is seemingly about to destroy Mickey; however the paint had already soaked into his core, changing his character. Now friendly, the Shadow Blot lifts Mickey into the air and tickles and cuddles the mouse affectionately. He then flies off in a wave, assumed to be departing for a new life in the Wasteland.
- The confusion between the names Shadow Blot and Phantom Blot are enhanced by the facts that in a lot of foreign translations, the Shadow Blot gets the country's name for the original Phantom Blot (Fantôme Noir in French, Macchia Nera in Italian). Also, in the Graphic Novel, he is mistakenly named Phantom Blot, while the Shadow Blot is named Blot Shadow.