Light in August is set in Yoknapatawpha County, Mississippi, which is a fictional county Faulkner revisited in many of his works. The main events of the book take place around 1932, but flashbacks stretch back as far as the antebellum period (prior to the legal abolition of slavery in 1865). Faulkner spent most of his life in the real-life version of Mississippi. However, he enjoyed unique opportunities to travel and learn from people outside of his home state. Light in August is one of many works in which Faulkner took both an insider's view and an outsider's view of the rural South under Jim Crow (the long period of violent segregation that eventually led to the Civil Rights movement).
Under Jim Crow, there was technically no more slavery. However, the South was still extremely dangerous for Black people due to intensified racism and retribution following the Civil War and Reconstruction. The Ku Klux Klan and other White terror groups murdered Black citizens in staggering numbers. There was an explosion of propaganda that stereotyped Black men as a physical and sexual threat to White women. This false narrative became a twisted justification for angry White people to hunt down and lynch Black men. It also became a justification for strict policing of women's bodies. Faulkner's novel imagines that Joe Christmas, Joanna Burden, Milly Hines, Lena Grove, Percy Grimm, and all the other characters are haunted by this false narrative and the stereotypes it creates. Try as they might to be their own people, they get caught up in the roles the rest of the world pushes onto them.
Faulkner had a complicated relationship with Southern culture, which shows in his storytelling. On the one hand, he saw the way prejudice, poverty, and the lack of a robust education system kept communities from flourishing. He blamed the South for many of its own problems. In the novel, the town of Jefferson comes off as a place where people are far too obsessed with gossip and the politics of race and gender for their own good. Internalized racism and misogyny make Joe Christmas's life a living hell until the end. Faulkner portrays this suffering as tragic but absurd given that it is never even clear whether or not Christmas has any Black ancestry.
At the same time, Faulkner hated the idea that outsiders to the region knew what was best for the South. Northerners in the novel come across as snobbish and ignorant to Southern ways of life. Later in life, Faulkner drew criticism for declaring that if the federal government sent troops to enforce racial integration in Mississippi, he would fight against them on behalf of his state. Horrifically, he claimed he would even take to the streets and start shooting Black people if it meant defending Mississippi from the meddling of the government in Washington. This troubling statement helps illuminate Faulkner's intense loyalty to the home state he depicts in Light in August. As much as he criticizes the culture in Yoknapatawpha County, he sees its problems as something to be addressed internally. He may think an overall sense of justice and human rights is something for the South to aspire to, but he wants the South to get there in its own way and in its own time.