Along with Oiwa and Okiku, Otsuyu is one of the three female ghosts that make up the "Nihon san dai kaidan" or Japan's big three ghost stories:
One dark night, the samurai Ogiwara spotted an elegant woman carrying a peony lantern wandering through the streets of Edo. For Ogiwara, it was love at first sight.
He invited the beautiful woman, Otsuyu, to accompany him home where they talked, laughed, and enjoyed each other's company. That night, Ogiwara's neighbor, hearing eerie laughter coming from Ogiwara's garden, peeked over the wall.
He saw Ogiwara holding, not a woman, but a laughing skeleton! The next morning, Ogiwara's neighbor revealed to him what he had seen. Horrified, Ogiwara went seeking advice from the priest at a nearby temple.
To his shock, Ogiwara found Otsuyu's grave at the temple. He realized that the woman he had fallen in love just the night before with had died long before they had even met.
Now that Ogiwara knew the truth, Otsuyu's ghost no longer appeared before him.
Even after discovering the truth Ogiwara missed Otsuyu desperately. After some time, he could no longer bear his sadness and returned to the temple where Otsuyu lay buried.
At the temple gates, Otsuyu appeared before him once more. Reaching out her hand, she asked Ogiwara to accompany her home. Without hesitation, Ogiwara took her hand, walking with her into the darkness.
After his final visit to the temple, Ogiwara vanished. The priest, concerned, opened Otsuyu's grave.
Inside the coffin lay two bodies: Ogiwara and Otsuyu, together forever.