The novel is set in an indeterminate dystopian future, speculated to be around the year 2005,[31] with a fundamentalist theonomy ruling the territory of what had been the United States but is now the Republic of Gilead. The fertility rates in Gilead have diminished due to environmental toxicity and fertile women are a valuable commodity owned and enslaved by the powerful elite. Individuals are segregated by categories and dressed according to their social functions. Complex dress codes play a key role in imposing social control within the new society and serve to distinguish people by sex, occupation, and caste.
The action takes place in what once was the Harvard Square neighbourhood of Cambridge, Massachusetts;[32][33] Atwood studied at Radcliffe College, located in this area. As a researcher, Atwood spent a lot of time in the Widener Library at Harvard which in the novel serves as a setting for the headquarters of the Gilead Secret Service.[10]