Soon afterwards, Xion confronts Roxas at the Twilight Town train station, and after revealing her altered form to him, transforms into armored machines as fixed by Xemnas and attacks him, in order to absorb Roxas and become the "real" Sora, thus fulfilling her purpose, which would overall prevent the real Sora from ever awakening. With her Secret Reports that are obtained at the end of the game, it seems that this appears to be a ruse. In her words, she knows that she and Roxas cannot coexist, placing him in danger if so, and has chosen willingly to disappear and not let Xemnas succeed: a fact that she states when she later dies. Aware that Roxas would not be able to kill her, and Axel had admitted that he could not either in his own Report, she forces Roxas to fight her instead. After a long and grueling battle, Roxas manages to defeat her, while she regains her original appearance in his view. When done, he doesn't seem to recall who she is, though she says it's okay.
Cradling her in his arms, Roxas shares an emotional conversation with her, during which she explains to him that she had no regrets for meeting him or Axel, reveals the true colors of the Organization to him, and pleads with him not to let Xemnas win before dying peacefully in his arms. Saddened, Roxas holds Xion's essence and degenerating crystallized body until she is completely gone, leaving behind a sole seashell, in addition to inadvertently bringing the restoration of Sora's memories to a complete stop.
Among the other Secret Reports obtained at the end of the game, it is revealed that she is experiment "No.i" of the Replica Project, and that she was bestowed a proper name, Xion, because living things need names to give meaning to their existence, and being a member of the Organization
Moments before the end of the game, Roxas has returned to the World That Never Was in order to destroy Xemnas and "set Kingdom Hearts free", but before he can reach the castle he is being stalked by Neoshadow Heartless as well as a determined Riku, standing on top of the skyscraper as seen in the Deep Dive trailer. He looks down upon the Nobody, before Roxas starts his path up the skyscraper. Through him, Xion is able to throw the Oblivion keyblade to Riku in order to tell him to stop Roxas before he can reach Xemnas, because she believes he is not strong enough to face him yet. In turn, touching the Oblivion causes Riku to recall flashbacks of the time spent together with her, causing him to be in slight confusion and shock for a moment. When both Roxas and Riku finished eradicating the Heartless, and turned on each other for a battle, while losing the first, Riku manages to stop Roxas once he removes the cloth from his eyes and transforms into Xehanort's Heartless. Unconscious then, Xion talks to Roxas through his mind, telling him not to be sad because she has become one with him and Sora, then she tells him that soon he too will become one with Sora. Despite the fact that memories of Xion have been forgotten by everyone, she tells him that she still has her own memories, so she doesn't mind that he has forgotten her, as she won't forget him or Axel.