We're in an alternate version of the Middle-East. The main homeland is a version of ancient Lebanon. Various peoples live in harmony.
The Tashtak, from Tash, are essentially Middle-Ages Arabs; educated, wealthy, and powerful due to ties with ancient dragons. Tashtak are dragonblooded (a new 4E race). The Tashtak live to the east and north, what would be modern day Syria. The Tashtak are way more advanced than other cultures. They meddle in affairs of other cultures, especially those of the less sophisticated Labash.
The eladrin (an official 4E race) are the original ancient race that lives in their homeland of Shamar to the south of Labash. They're a bit haughty, but mostly because they've seen everything and the other races are uppity newcomers. The other races were created by the gods, but the eladrin were just always there. Centuries ago, the eladrin left their homeland for reasons unknown. The eladrin didn't just flee their homes, they fled the plane! The eladrin returned from exile about a hundred years ago, displacing those who took over their ancient kingdom, the halflings.
The halflings are nomadic traders whose populations tend to grow at very high rates (they're like rabbits in many ways), resulting in inner conflict. For centuries, the halflings had stopped their wanderings and found a home in the eladrin homeland. When they were rudely evicted by the eladrin, many could no longer go back to their wandering ways. They make up ghettos and refugee camps throughout Labash, often residing in swamps and on river boats, plying the waterways. They are generally disliked as they represent all the external problems of the realm. The Tashtak support many halfling groups, providing material support and weapons, but only enough to make the halflings a thorn in the side of the eladrin, never enough for them to be an actual threat to other nations.
The dwarves are another created race and play the usual underground craftsmen role. Their homelands are in the mountainous regions but they are generally cut off from civilization due to other threats in the hinterlands, especially ogres.
The Badari are the ancient Egyptians of the world. They are tieflings (a 4E official race). In their past they've had dealings with devils; thus their infernal heritage. They are culturally right after the time of the ancient pyramids, complete with all the Egyptian gods, culture and pharaohs. The Badari influence the Labash to a great extent, but they tend to reserve their underhanded activity for their arch-enemies the Tashtak. Unfortunately, the Labash always seem to be in the middle, suffering the consequences.
The elves are woodland folk found mostly throughout the cedar forests of Labash. As with the new 4E model, elves are all wood elves, and tend to revere nature and keep the ogres from getting too powerful.
The ogre kingdoms exist in the hills to the East of Labash. They are supported by their goblin minions. They generally war amongst themselves, raid against elves and dwarves, and cause trouble for both the Tash and Labashi. They are insatiably hungry and raid villages of all sorts on their borders for food. As horrible as they are, they act as a buffer against the Tashtak. The Tashtak cannot pass west from their kingdom. Instead they come south or via the sea. The ogre kingdoms are modeled after Warhammer Fantasy ogres.
Finally, there is Labash. Labash is a region comprising what we know as Lebanon. The cities within Labash are powerful coastal city-states, so they form no unified kingdom, which is why they are easy to manipulate by outsiders. Nobody is Labashi, as people identify themselves by their city-state. For example, if you're from Zor, you're Zorian and you might have just as many problems with the Gebali city-state dwellers as the Tashtak. Where the other kingdoms were once great and now in ruin, Labash is ancient, but its power is at its height in the world.
The PC's are from outside the city-state of Zor (ancient Tyre).
Zor: maritime and trade center. People known as Zorians. Zor means “rock” Consisted of two distinct urban centers, one on an island and the other on the adjacent coast (approximately 3.5 miles apart). One was a heavily fortified island city amidst the sea (with defensive walls 150 feet high and the latter, originally called Ushu was actually more like a line of suburbs than any one city and was used primarily as a source of water and timber for the main island city. Occasionally they fought against each other, although most of the time they supported one another due to the island city’s wealth from maritime trade and the mainland area’s source of timber, water and burial grounds.
Zor is a metropolis with a population of 200,000 spread throughout dozens of districts.
• Berothai: Trade and religious center. Olive oil
• Gebal: Trade and religious center. Cedar, wine, olive oil
• Zidon: maritime and trade center.