Sixteen years ago before the current storyline, a war between magicians took place. Kazuma Ryuusenji wanted to erase all human life. However, he was stopped by 15 great magicians who split the world in two.
The Living World is what was formed after the world was split in two. It is referred to as the 'Cursed Land' because if Magicians attack another Magicians with Ancestral Magic while in that world it will cause them to lose all of their abilities.
Magician are currently at war to see which one of the Communities will, in order to claim the True Power which resides in The Living World. And to ensure that the magicians could no longer do battle in The Living World, the wise man, a magician of the highest level cast the Gift spell upon it. The Gift is a type of magic that prevents magicians from battling one another in the human world. However, using normal magic is fine but a magician may not use Ancestral Magic to attack another magician.
The Living World world is the home of all the humans who cannot use magic while The Ruined World is home to the magicians or humans that can use magic.