Xak features a typical high fantasy setting. According to the game world's legends, a great war was fought between the benevolent but weakening ancient gods and a demon race, which led to the collapse and eventual mortality of the gods. After this 'War of Sealing', the gods divided the world into three parts: "Xak", the world of humans, "Oceanity", the world of faeries, and "Xexis", the world of demons. The demon world of Xexis was tightly sealed from the other two worlds as to prevent reentry of the warmongering demon race. Some demons were left behind in Xak, however, and others managed to discover a separate means to enter Xak from Xexis anyway.