The game is set in the Jade Empire, a fictional kingdom based on elements of Ancient Chinese history and Chinese mythology. Humans live side by side in the mortal realm with mystical creatures and monsters, while the heavens are ruled by the August Personage of Jade through a Celestial Bureaucracy. Human sorcerers are able to harness the Five Elements in their magic.[5] There are two languages spoken in the Jade Empire: an unnamed primary language (represented by English) and Tho Fan, the "ancient tongue"; once common, Tho Fan's speakers have become scarcer in the Empire, though most inhabitants are able to understand it.[6] In the Jade Empire's recent past, a devastating drought threatened to destroy everything, but the drought came to an end through the actions of Sun Hai, current ruling emperor of the Sun dynasty, leading to him being worshiped as the Empire's savior.[2]: 2 Key locations include the isolated village of Two Rivers, where the story begins; Tien's Landing, a former major port now shunned due to its dark past; the Imperial Capital, seat of Sun Hai and center of the Jade Empire; and Dirge, a ruined temple haunted by the spirits of its inhabitants.[7][8]
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