Loke arcThe gang first meets Loke upon completing a mission in Balsam Town. They wander over to find out that Loke had a mission in the area (before running away from Lucy). When Lucy goes outside with Plue and Happy because the others were engaged in a serious pillow fight, she is assaulted by bandits; however, she is saved by Loke. Loke then states that his job was to capture them. As thanks for saving her and to chat, they go to a local bar together, with Loke still being afraid of her. Lucy, thinking that their conversation is completed, gets up to leave, but Loke stops her and then hugs her, announcing that he will die soon. Realizing that he didn't want to get her involved, he then states that he was joking and that it was just one of his pick-up lines.
This makes Lucy so upset that she slaps him and storms off. The next day, Loke's girlfriends are at the guild, upset that he had broken up with them and are looking for him, confronting Lucy when Mirajane calls out to Lucy for help, which results in them thinking that Lucy is the reason Loke left them. Lucy is suspicious of what he said the night before, and summons Crux to do a search on him, finding out about Loke's history and former owner Karen Lilica. Gray then bursts into Lucy's room, saying that Loke had quit the guild and disappeared. Lucy decides to go look as well, thinking she might know where he is.
Lucy goes to the area Loke is at (Karen's grave). She reveals she knows Loke is the Celestial Spirit, Leo the Lion. Lucy asks why Loke is still in the human world. Loke says he's stuck and has been for three years, but is now losing his ability to stay in Earthland much longer. Loke reveals he cannot go back because he killed his master, Karen Lilica. After telling Lucy his past, Loke finally starts to lose his grip and tells Lucy goodbye and asks her to tell Fairy Tail that he's sorry. She tries to save him by opening his gate so he can live back in the spirit world. Loke begs her to stop and says that he deserves to die, as it is the rules. Lucy, however, shouts that she would change the rules and tries to forcefully put Loke back by using her spirit energy. Noticing this, the Celestial Spirit King appears himself.
He explains that although Loke did not directly kill Karen, it was still his actions that caused her death. In an attempt to convince the Spirit King, Lucy summons all of her current Gold and Silver Keys, stating that saving your friends is not a sin. It amazes Loke that she could summon this much at once, since it requires a huge amount of energy, although they quickly disappear. The Celestial Spirit King, seeing Lucy's resolve to save her friend, allows Loke to return to the spirit world since he realizes Loke only disobeyed Karen for the sake of Aries. Loke says farewell, and as thanks for saving him, gives her his key.
Loke reappears at the guild's makeshift bar, surprising Natsu, Happy and Gray with the revelation that he is a Celestial Spirit who looks human, much like Virgo. When asked what spirit he is, Lucy reveals that Loke is Leo the Lion, much to Happy's delight to the point that he drooled on his shoulder. Getting a bit too flirtatious with Lucy, she nearly closes his gate, but he stops, saying that he has something to give them first: tickets to a resort hotel.
Fighting Festival arcBefore Lucy is finished off by Bickslow's strongest attack, Baryon Formation, Loke rushes in without being called and saves her before she's hit by the attack. Loke appears to have a totally different look, with his hair extended into a lion's mane and a black suit; Loke states he has come to fulfill his promise with Lucy.
Bickslow mentions that he always had a feeling Loke was a Celestial Spirit; Loke responds that hurting his owner is something he can never forgive. Bickslow laughs and reminds Loke that he's never once beaten him in a fight. Loke orders Lucy to stay back, however, Lucy refuses and states that Celestial Spirits aren't shields and that she would fight together with Loke. Happy whispers that "they're a cute couple", making Lucy shout at him.
Eventually, Lucy entangles Bickslow with her whip and Loke finishes him off with his Regulus Impact attack, knocking Bickslow out in one hit; he then makes a light saying "I Love Lucy" for Lucy to which Happy whispers "He llllikes you". After Lucy falls down, feeling the affects of summoning two Ecliptic Zodiac keys, Loke returns her keys and says that he will always be there when she needs him. He later makes a brief appearance at the guild with Lucy as everyone celebrates and recovers.