Yang Child takes place on a sub continent called Lath. The whole of Lath is separate from all other continents and is located in the south western Arrliann Ocean. Originally, it was inhabited by wood elves, mythrin, dracony, and a wealth of flora and fauna. Since humans came to Lath, bring with them new species, much of the plant and animal life has been driven out. Some species, such as the dracony, have been completely wiped out.

Lath has had a short, but complicated and often violent history. It once had a king that aspired to make the perfect society. He passed many laws aimed at equalizing all people, giving women and children rights, and preventing cruelty to all living creatures. When he died without an heir, many of his nobles strived to take the throne. Wars broke out, resulting in all of the provinces of Lath becoming more like small countries than parts of one country. No one has successfully taken the throne, though many have claimed it as their right to have it. In the multitude of wars that took place after the King's death, many of the laws aimed at protecting people were either ignored or turned towards controlling and excluding people.

This is the situation that Luta and company have found themselves in. One of the major laws says that those under 16 years of age can not work for anyone but their families. This essentially locks Luta, Leanna, and other orphaned children out of work. Unlike many of the child protection laws, this one remains in effect and children under 16 years of age found working are severely punished with jail time or placement in a temple or orphanage. This does not stop people from hiring children. Instead, it allows employers to hire kids and then pay them very little for their work. By teaming up with Bryoak, Luta and Leanna can work without as much suspicion since Bryoak is over 16 years of age.

About 17 years before the comic starts, a mythrin name Kithryn led a rebellion against the princes and princesses the rule the provinces along the eastern coast. Her rebellion failed miserably and most of those involved were killed, though Kithryn herself was never caught. The backlash from humans was quick and brutal. Despite the fact that the rebellion was largely made up of mythrin and poorer humans, rulers in the affected provinces ordered the killing of wood elves since it was believed they would also rebel. Thousands were killed. Many wood elf children were left orphaned and adopted by other groups. After the killings stopped several months later, new laws were put in place to restrict wood elves movement. These laws vary from province to province. Some only require them to wear their tribe markers. Others have completely forbidden wood elves to live in the province.

Only a few years after the rebellion, it was announced that a goddess had been born into a human body. Since then, there have been great efforts put into finding the girl with the goddess in her, though with no success. The exact date of her birth is unknown, though she is expected to be between 12 and 16 years of age. Most people are unsure of how to tell if someone has the goddess, though odd colored hair or eyes and magic abilities are said to be a sign.