It's the year AC (After Colony) 195. Over the past century, humanity has established a number of space colonies, giant wheel-shaped constructs that are home to millions of people. These colonies are grouped in clusters at the five Lagrange points, areas of relative stability in Earth orbit.
For decades, while the Earth's surface was wracked by war and civil strife, the peace and quiet of the space colonies presented an attractive alternative for war-weary settlers. When the terrestrial wars ended, a new world government was established, a "United Earth Sphere Alliance" committed to bringing about peace through force of arms. In the name of peace and justice, the Alliance seized control of the colonies.
Under the pretext of restoring order to the colonies, the Alliance staged a second military intervention, using humanoid fighting machines called mobile suits to crush all opposition.