Crystal Castles has nine levels with four castles each, and a tenth level which features a single castle — the clearing of which ends the game. Each of the 37 trimetric-projected castles consists of a maze of hallways filled with gems and bonus objects, and also includes stairs, elevators and tunnels that the player can use as shortcuts. The three-letter initials of the player with the highest score are used to form the first level's castle structure. When all gems in a castle have been collected, the player moves on to the next castle. The player can also skip some castles and acquire additional lives and points by using secret warps activated by making Bentley Bear jump at special locations.

A trackball and "jump" button are used for controlling Bentley Bear's motions. Gems are collected by simply walking over them, and a bonus is given upon collection of the last gem. While collecting gems, there are a number of enemies that try to stop Bentley and/or collect the gems for themselves. With two exceptions, if touched by the enemies he will lose one of his lives. Any gems collected by the enemies also result in a lower obtainable score for that screen. Likewise, if the last available gem is collected by the enemy, the player also loses the last gem bonus.

Enemies can be avoided by use of the maze and its constructs, or by making Bentley jump over opponents with the jump button, in some cases also allowing him to stun them. Some types of enemies will track Bentley's movements in certain ways, while others move at random. If Bentley is touched, he "cries out" in a distinctive manner with the use of a cartoonish word balloons. If 3 or more lives remain, he says "BYE!"; if 2 lives still remain, the quotation is "OH NO!"; if 1 life is left, it is "OUCH!"; and finally, for the last lost life (which ends the game), he says "#?!", so as to imitate an obscenity.

At the beginning of every maze, gems are worth 1 point each; this value increases by 1 for every gem Bentley picks up, to a maximum of 99. Each maze also randomly includes a hat or honey pot, which serve the dual purpose of awarding points and providing Bentley with the ability to defeat specific enemies. The hat is worth 500 points and will make Bentley invulnerable for a few seconds and allow him to eliminate Berthilda the witch, who appears in the last maze of each level. The honey pot is worth 1,000 points, and picking it up can delay the landing of a swarm of bees.

Other villains present in the game include: "Nasty Trees" which become more ornery as levels progress, a ghost that will usually appear in the Hidden Spiral levels, dancing skeletons, "Gem Eaters" who Bentley Bear can defeat if he catches them while eating a gem, and also the devilish "Crystal Balls" creatures that in later levels tend to follow Bentley Bear persistently as he collects gems. The Nasty Trees and Crystal Balls can also pick up gems.

Crystal Castles was the first game to use the Leta chip, a custom trackball controller chip designed by Scott Fuller. Bentley Bear's original name was 'Braveheart Bear' in the game's prototypes.

Crystal Castles contains two notable easter eggs. Jumping 100 times or more in the southeast corner of level 1‒1 and clearing the maze of all gems will make ATARI appear on level 1‒2. On level 5‒4, if the player kills Berthilda and goes to the corner of the area where she was and jumps, "FXL" will appear in the southeast corner of the screen. These are the initials for Franz X. Lanzinger, a designer of Crystal Castles.

Bentley Bear later made a cameo in the game Atari Karts for the Atari Jaguar, where he was a selectable racer.

Crystal Castles has been ported to the following home computers and video game consoles:

• Apple II – Simpler graphics, but the gameplay is quite close to the original.
• Atari 2600 – Because of the technical limitations of the Atari 2600, the game has been simplified.
• Atari 8-bit – Graphically better than the 2600 version, the mazes actually resemble the arcade. Was finally released as an XE cartridge. Very rare.
• Atari ST – Although the ST would have been capable of a graphically near-perfect port, all graphics have been repainted, making it look quite different from the arcade version. Gameplay is about the same as the original except for the difficulty level, which is lower than that of the arcade original.
• Commodore 64 – Simpler graphics, but the gameplay is quite close to the original.
• BBC / Acorn Electron – Good graphics, close to the original.
• ZX Spectrum – Two-colour graphics in the main gameplay area due to the Spectrum's attribute clash problems.
• Amstrad CPC – Four-colour graphics using the Amstrad's medium-resolution screen mode.
• PC, PlayStation and Dreamcast – Arcade version as part of the Atari Anniversary game.
• Windows, Xbox, and PlayStation 2 – (both in arcade and Atari 2600 format) as part of Atari: 80 Classic Games in One! (2003) and Atari Anthology (2004).
• Xbox 360 and Windows – (Arcade format) as part of Game Room (2010).

In addition, certain ports use dimetric projection, as opposed to the arcade version's original trimetric projection, to display environments.

The Toronto-based band Crystal Castles credit the 1980s video game as the inspiration for the name of their band.

Bentley and Crystal Castles are referenced by Lupe Fiasco in his song "Audubon Ballroom" on his 2012 album Food and Liquor II: The Great American Rap Album, Pt. 1.