From the introduction:
Long ago, the world was created by three goddesses. For a time there was a golden era, with various spirits and minor deities watching over parts of the land on behalf of the goddesses. But it was not meant to last, and a great evil rose up from the shadows, a demon by the name of Demise. Thanks to the actions of a lesser goddess, Hylia, and a mortal champion of hers, Demise was sealed away. However, his sword had a unique trait to it - it had a spirit. Calling itself Ghirahim, it began to continue the conquest Demise had started, and so Hylia lifted a portion of the land into the sky, giving it the name Skyloft, and saving the race she had been tasked with watching, the humans.