The setting for the story is in the home and environment of a middle class family in the UK, where Paul, the young son, is the one who begins to show an ability to take care of the family by winning huge sums of money at the horse track.
The setting moves between the home of the family as well as the horse track and other places in the city, but mostly focusing on the two. One of the most important things about the setting is the strain that the family feels in order to keep up the appearance of their station which is really higher than the parents' income allows. It is this strain that drives the conflict and is really the underlying theme of the story.
The setting is actually very closely related to the point of view of the story. Remember this is written in the first person point of view, and thus we only know what the narrator knows. It is clear that at the start of the story we are in some kind of stone age world. The narrator talks about a community that has to hunt, and a world that is full of taboos - not how many times the phrase "It is forbidden" is repeated in the first pages. The reference to spirits and purification and laws all seem to reinforce that the setting is a primeval civilisation where people are governed by supersition.
However, as the story develops, we begin to realise that the setting itself is very different - we are in a post-nuclear disaster world where civilisation as we know it today has been completely destroyed. Thus we recognise what John does not - highways, skyscrapers, statues of George Washington. This point of view serves to emphasise the dangers of nuclear disaster. The author presents us with a world that regressed back to stone age times and where all advances of civilisation have been completely forgotten.
The novel is set during a future nuclear war, although for contemporary audiences it would probably feel more like a past nuclear war, since it is based on WWII. During this war, a group of boys is evacuated from England to Australia. Their plane crashes somewhere along the way. The fact that all adults on board have been killed, in addition to the war that has driven the boys from their homeland, creates a setting in which the children have no to rely upon but themselves.
The island on which they crash is tropical. There are continual references to "the jungle", and the plants are described as "vines and creepers". A basic description is:
roughly boat-shaped: humped near this end with behind them the jumbled descent to the shore. On either side rocks, cliffs, treetops and a steep slope: forward there, the length of the boat, a tamer descent, tree-clad, with hints of pink: then the jungly flat of the island, dense green, but drawn at the end to a pink tail. There, where the island petered out in water, was another island; a rock, almost detached, standing like a fort, facing them across the green with one bold, pink bastion.
Wild pigs live there as well, and they constitute a major portion of the boys' diet later in the book. The island remains unnamed, but there is a question as to whether it has been previously discovered and charted or not. Ralph claims it has, but his father is in the Royal Navy, & he may just speaking from pride. The ship that rescues them is drawn by their smoke, not any other knowledge of the island, so there is a suggestion that they could have remained unfound.