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Either for leveling up or to upgrade weapons. Perhaps it depends on playstyle/class as well?

By "not necessary", I mean you gain souls in the normal course of trying to play through the game. Instead of explicitly setting out with the goal of farming souls in an area before proceeding.

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I didn't farm souls and had no problem finishing the game by leveling through "normal" soul acquisition. Moreover, some people try to beat the game without leveling as an extra challenge, so grinding souls is definitely not necessary.

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I've been going through a Soul Level 1 playthrough myself... but that doesn't mean I haven't been grinding. I did plenty to upgrade my armour, weapons and pyromancy flame! –  YellowMegaMan Mar 26 '13 at 2:31
    
I replayed the game recently and the only grinding I did was about 30 minutes on barbarians in blight town because I wanted one of their clubs. I still found it pretty easy to beat the game (even the bonus DLC boss) without having to stop and grind souls just to get past a difficult area. Though as another answer said, I guess if you die left and right and keep losing all your souls, you might need to do some grinding. –  Sterno Mar 26 '13 at 13:51
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Simply put the answer is no, you are not required to farm souls. If you understand the game mechanics and decide upon your leveling priorities you should never have to farm for souls to be able to progress.

That is a big "if" though. Leveling a stat you do not need or dying often and not being able to retrieve your souls can put you in a situation where you need to farm to get back on track.

It will mainly come down to how good you are at the game, and how often you die. (From personal experience, I die far more from falling to my death than actually being killed by an enemy >.<)

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Well, that depends on how you do in the game. If you die a lot (which in this game would be quite normal) then you might need to go spend slightly more time killing the same things in order to have souls for weapons upgrade and the like, besides buying some other useful items.

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It's absolutely not strictly necessary. If you just want to see the content, you can easily just push through assuming you are skilled at the game. Like was previously mentioned, if you have trouble or just want to level up a specific skill/item, it's quite easy to do.

If you ever need some extra souls, I'd highly recommend dropping a summoning sign next the the door (or previous bonfire) of a boss you feel comfortable helping with. A single boss kill assist is tens of thousands of souls and will often buy a few levels with only a few minutes of work (assuming you get summoned quickly).

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It sort of does.

If you like leveling your character and buying stuff from merchants than you should try it every other time you rest at a Bonfire and if the location is preferable like in the "Undead Burg", it has tons of paths to maneuver and has a lot om mediocre enemies and a few stronger ones.

Overall, it is benefitial but after a while it may get boring but that is where the patience aspect of the game comes in. Trust me, when you soul farm a few times and level up a couple times, the enemies will become play-do in your hands if you know what you are doing!

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It is definitely not necessary. Simple proof:

  • Visit Oswald of Carim
  • Buy a copy of the book of sinners
  • Have a look and see what level many of the top ranking people, many are level 1 or level 7

That being said, Dark Souls is exceptionally challenging. Even though levelling up will increase your HP, Stamina and Defense, it will also invite tougher phantoms into your world, which I find is even deadlier than the NPCs.

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