On 16 March, 2000, LucasArts Entertainment announced a partnership with Verant Interactive Inc. and Sony Online Entertainment to create the first massively multiplayer Star Wars online role-playing game. The then unnamed game would be developed by Verant with online play supported by SOE. This was the same team responsible for creating and supporting the popular EverQuest multiplayer online game. LucasArts would be responsible for all distribution of the Star Wars online game. The announcement included an expected release date some time in 2001 and that the game would take place during the original trilogy era. LucasArts officially announced the brand name of the game to be Star Wars Galaxies on 29 November 2000. The announcement claimed the first round of testing for Star Wars Galaxies was expected to start in late 2001 which would push back the official release date to an unknown time. The game`s official information site was launched on 30 November 2000 in conjunction with SOE and featured frequently asked questions about the game and message boards fielded by members of the development team.

The game events were originally set following the destruction of the Death Star in Episode IV: A New Hope, but before the beginning of Episode V: The Empire Strikes Back, but have recently moved on to the beginning of Episode V.

The game launched with 10 planets: Tatooine, Naboo, Corellia, Talus, Rori, Dantooine, Lok, Yavin IV, the forest moon of Endor, and Dathomir. In the second expansion, Rage of the Wookiees, the Wookiee home planet Kashyyyk was added. In the third expansion, Trials of Obi-Wan, the planet Mustafar was added. Each of the original 10 planets are represented by approximately 225 square kilometers (15 km x 15 km maps) of game space. In contrast, the expansion planets of Kashyyyk and Mustafar are smaller, constructed differently (e.g. instances) and in some cases imposed different rules than the original, such as terrain that is not traversable (i.e. mountains or hills that cannot be climbed over).

In addition to the 12 planets, there are 12 space zones, each encompassing approximately 3400 cubic kilometers (15 km cubes) of fully-navigable space. Nine of them are associated with one or more of the playable planets: Tatoo (Tatooine), Naboo (Naboo and Rori), Corellia (Corellia and Talus), Dantooine, Karthakk (Lok), Yavin, Endor, Dathomir, and Kashyyyk. (Mustafar has no associated space zone.) Kessel and Deep Space have no planets and are used for high-level gameplay and player-versus-player combat. The Ord Mantell sector was released in January 2008 as a new space-only zone, though there is a space station there (called Nova Orion) where pilots can land and acquire quests. The planet Hoth was added in November 2008 as part of an instance. However, the planet can only be explored during the events of the Battle of Echo Base.

Examples of characters and points of interest that players can visit within the game include R2-D2, C-3PO, their escape pod on Tatooine, the Naboo Royal Palace, the abandoned Rebel bases on Dantooine and Yavin IV, the notorious pirate Nym in his stronghold on Lok, Ewoks and Rancors. Other main characters include Luke Skywalker, Han Solo, Princess Leia, Darth Vader, Chewbacca, Emperor Palpatine, Admiral Ackbar, Jan Dodonna, Boba Fett, Jabba, Borvo the Hutt, Bib Fortuna, Salacious Crumb, General Otto, Captain Panaka (appears as Colonel Panaka), Max Rebo, Wedge Antilles, Gavyn Sykes, Watto, HK-47, Boss Nass, Admiral Thrawn, the "reincarnation" of General Grievous as NK-Necrosis, and the Force ghost of Obi-Wan Kenobi.