Where It All Goes Down
The Kingdom of Dor
The entirety of The Tale of Despereaux takes place in the Kingdom of Dor, which is ruled over by King Phillip. Dor means "golden" in French (d'or). It's a pretty classic fairy tale kingdom with lots of subjects, a happy, beautiful princess, and a big castle filled with wonderful objects for Despereaux to admire:
He spent the days as he wanted: He wandered through the rooms of the castle, staring dreamily at the light streaming in through the stained-glass windows. He went to the library and read over and over again the story of the fair maiden and the knight who rescued her. And he discovered, finally, the source of the honey-sweet sound.
The sound was music. (4.3-4)
But the Kingdom of Dor is not all sweetness and light; there's some darkness that lurks within its borders. Within the very castle where the royal family resides with all their servants is a pretty miserable, terrifying place—the dungeons.
The Dungeons
A great deal of The Tale of Despereaux takes place in the other part of the castle—the dark and horrible dungeons. Here's a description of what this underground landscape looks and smells and feels like:
It was quiet in an ominous way; it was quiet in the way of small, frightening sounds. There was the snail-like slither of water oozing down the walls and from around a darkened corner there came the low moan of someone in pain. And then, too, there was the noise of the rats going about their business, their sharp nails hitting the stones of the dungeon and their long tails dragging behind them, through the blood and muck. (31.11)
The dungeons are where condemned mice are sent to die, and where human prisoners are sent to live out the rest of their days in abject misery. The rats rule the dungeons and take pleasure in manipulating the prisoners and killing their last shreds of hope. It's not a place where anyone would ever go by choice. Just get us out of here ASAP—we promise to behave!