At first Pegasus appears to be the cold-hearted villain of the first season, but there's more to his that meets the eye... (bad pun, I know^^)
When Pegasus was young, he met a girl named Cynthia. It was love at first sight and they spend all their time together. At this point in time, Pegasus was an artist and he loved to paint gorgeous portraits. With Cynthia, Pegasus was truly happy. They were to wed, and he thought nothing could go wrong, but fate wasn't so kind to the young boy. Cynthia died just as they were about to be married, and Pegasus was crushed.
Devastated, Pegasus became depressed and stopped painting. The smile he once wore disappeared from his face. But in this time he also became very determined. Pegasus was willing to do anything to get her back. After hearing of the ability to raise the dead, Pegasus traveled to Egypt. There he searched for anything that could help him in his quest.
One day, he saw a mysterious man on he street. He followed that strange man (Shadi) to a tomb. There, his right eye was gouged out and replaced by the metal one - his millennium item. This eye allowed him to see things he never imagined before - and even allowed him to see his precious Cynthia.
But all he could do was see her. All Pegasus wished for was to hold her in his arms. And he was willing to do anything to get his way.
While in Egypt, he learned of the ancient duel monsters card game. After he returned to America, he adapted this game through his company - Industrial Illusions. He modernized it and added a few cards of his own. He's the modern "father" of the card game.
His Millennium Eye allowed him to see into other people's minds. This came in handy when he played the card game. He looked into the minds of his opponents and viewed their strategies and cards. Using this knowledge, and his already impressive skill as a duelist, Pegasus was incredibly hard to defeat. Pegasus could also use his eye to capture souls into cards. He does this to Yugi's grandfather, Mokuba, and Kaiba.
After Pegasus is defeated by Yugi, his world falls apart. His true intentions are finally revealed. He wished to take over Kaiba Corporation just so he could use their technology to try and bring back his dead wife. But Pegasus's true self doesn't stop there. After the duel, Pegasus keeps his word and releases the souls that he captured.
He also runs into Yami Bakura after his final match. But in his weakened state, Pegasus is no match for Yami Bakura and the evil one wins. He pulls out Pegasus's millennium eye and adds it to his collection.
Therefore Pegasus is not what he seems. He may seem like the evil bad guy, but he's really a man who just wishes to be with his one true love once again. His story is one of pain, but maybe now that all this madness had ended, Pegasus will be able to join her once again...
