In the primordial era, the Dimension of Existence was divided into two regions - the western region from where the Yang energy originated and the eastern where Yin energy originated. The west was resided by gods headed by a being who called himself 'The Heavenly Emperor' while the east was where the demons lived ruled by an unknown and powerful being, known as 'The Celestial Demon'. In the era which came after the Primordial Era, the gods and demons became aware of each others existence.
They waged wars against each other, the battles lasted for millions of years, until one day when suddenly the Gods and the Demons were shut off from their homelands and were sealed away from the west and east regions. Their source of energies were cut-off from them and their existence itself began dissipating. The gods and demons were not willing to just die, so they left behind their legacies, created planes and realms.
This marked te end of Ancient Era and the dawn of a new era called Modern Era and the birth of many different races.