Setting

Building setting for a tabletop RPG effectively requires that two things be taken into account.

First, the overall fictional setting describes where you are. Before players can have fictional characters, those people need somewhere to exist.  This could be just about anything; “a spooky manor in modern times” is a setting; so is “the 'verse of the Firefly TV show” or “the ancient Assyrian empire”.

Second, a premise for action describes what you do. Before creating characters, there should be a basic premise for action.  This can be fairly constrained, such as having the characters as elite military officers in a special squad that will receive missions to carry out – or it can be almost entirely open, such as saying “You're all down-and-dirty in Wharf Town, you could all use some coin.  The rest is up to you”.

Not all published games state their premise clearly, but the selection of what to include in the setting material generally gives a good idea the intended or assumed premise.  A game that presents lots of monsters and the statistics for getting into fights with them is a game where you're going to be fighting some monsters.  A setting littered with ruins and discussions of what may be found within is one that expects that characters will be exploring some ruins.

Ultimately, this means that the setting as a whole is a storehouse of material that you'll use in specific situations that you expect the characters to interact with.  Thus, when designing setting details, it's best to start from the viewpoint of who the characters are going to be and what they're going to do.