There are two elements of the conditions in Alabama during 1935 which are directly significant to the plot of To Kill a Mockingbird. First, Alabama, like the rest of the country, was suffering from the effects of the Great Depression. Jobs were scarce. Food was scarce and many people could not afford basic necessities. Small farmers like the Cunninghams were on the edge of ruin, and families like the Ewells had already fallen out of mainstream society because of their poverty.
The hopelessness of many people during the Depression only accentuated the other condition in Alabama that is directly relevant to the story. Racism which had never abated in the Southern states since the days of slavery, grew worse in times of economic struggles. The first people to lose their jobs were the southern blacks. Whites tended to blame the blacks for their problems and take out their frustrations on them. Blacks in Alabama were denied their right to vote. Special laws against blacks called the Jim Crow laws made them second class citizens. Thus blacks like Tom Robinson could never hope to get justice in the racist South. The Judges, juries, and lawyers were all white. Racism was so entrenched that even when the evidence supported a black man, a white man would never take his side. This was the condition of Alabama in "To Kill a Mockingbird." You can find more detail at the link below to the historical context notes here at enotes.