In the first half of the 20th century an industrialist by the name of Andrew Ryan, built an underwater utopia called Rapture.

Rapture was populated by the world's best and the brightest and was seen as an unbridled success. A undetermined period of time later a new species of sea slug that secreted stem cells was discovered in the ocean surrounding Rapture.
This allowed the inhabitants of Rapture to enhance physical and mental capabilities and to heal old wounds.
These stem cells, known as Adam, became so sought after that a war to control the substance broke out between Andrew Ryan and one of Adam's original discoverers, a scientist named Fontaine.

The war was eventually won by Ryan, however the population, having modified themselves to survive the war, was changed forever. They were now addicted to Adam and depended on it for their survival.

The game starts as the player's aeroplane crash lands in the ocean near Rapture ten years after society collapsed.