The setting expresses the themes of the story, taking place in a contemporary urban neighborhood of the 1960s. Also set in California in a large university town, the people who live there are from diverse ethnic backgrounds. The various ethnicities allow the author to illustrate the theme of accepting people who are different from ourselves. This is seen in the neighborhood's view of the Professor. The differences in the children's backgrounds also serve to show the differences between the adults and the children.
The lives of people living in urban areas are also depicted. Many of the neighborhoods are defined by poverty and crime. They don't always have the necessities of life, and their private lives are often in shambles. This view of life shows the theme of the friendships developed between the children in spite of a lack of love and family structure. They don't judge each other and are willing to compromise whereas the adult world is totally opposite.
The ability of children to survive in spite of the obstacles in their lives is also illustrated. They use their imagination and creativity when they make up the Egypt Game in order to make up for their sense of loneliness and lack of belonging. The game expresses their hope and optimism in a world of pain and violence. The setting again illustrates this theme.