Tales of Berseria is set in the continent of Glenwood, in the distant past of the Tales of Zestiria game. Central to the setting is the Sacred Kingdom of Midgand, which stretches across multiple large islands and smaller archipelagos. It is large enough to have climate variations ranging between its northern and southern regions, with the northern regions recently experiencing stronger snowstorms as the world grows colder. The Kingdom continues to develop its shipbuilding capability, but due to harsh weather, seaborne trade must still travel well-known paths, which are constantly beset by pirates.

Three years ago, a sickness known as Daemonblight befell the land. The sickness turns people into Daemons, and the world has fallen into an age of chaos. Even then, in a remote region of the Kingdom, the protagonist Velvet lived with her family in relative comfort. A night came when a red moon rose, and she was betrayed by Artorius, who was once her savior. She lost her family, while a mysterious power that consumed demons possessed her left arm. A measure of order returned to the world after Artorius founded the Abbey and the Exorcists. Artorius is hailed as the world's savior, but Velvet harbored only anger for him.