The Giver is set at some unspecified time in the future. Most of the novel takes place inside the Community, an isolationist society with strict rules and assigned roles that supposedly make for a sustainable, egalitarian living situation.
The Community was established at some point long ago, after a procedure was invented to turn a single person into the keeper or "Receiver" of all historical memory. The Receiver remembers everything so that all others in the Community can live their lives safe from the memory of physical and emotional pain. Their society is carefully engineered to prevent new injury and difficulty, so pain beyond that of a scraped knee is almost incomprehensible to everyone except the Receiver. Because the Receiver holds onto the history of fraught social issues like racism and classism, the Community is theoretically free even from prejudice.
While the Community at first seems like it might be a peaceful place to live, the novel slowly uncovers more and more ways in which its members are languishing or even suffering. For example, it soon becomes apparent that no one can see color anymore. While people seem to get along with black-and-white vision, Jonas wishes everyone around him could experience the beauty of a world in vibrant colors that opens up to him when he becomes the new Receiver. More disturbing is that when Jonas discovers the feeling of love, his parents tell him that love is an inappropriate word. He should instead describe all of his relationships in terms of their function in society. Jonas eventually discovers that this avoidance of love has led to the casually cruel practice of eugenics even by his own father. It does not matter that his father is a Nurturer assigned to take care of newborn children. If a child's function in society is questionable, his father kills the child to avoid upsetting the equilibrium of the Community. The Committee is the ruling body that governs such decisions as when to "release" (kill) a person. The Receiver sometimes advises the Committee based on historical memories, but Committee members never take on the memories themselves. Their unwillingness to do so demonstrates that the Community is governed not by critical thinking, but rather by blind trust in a system none of them helped to build.
It is important to note that the Community is just one society in a broader world known within the novel as "Elsewhere." "Elsewhere" is far less authoritarian and looks more like rural North America in the 1990s. Gabriel and Jonas flee to "Elsewhere" at the end of the novel. In the final scene, the two of them sled down a hill toward another community that seems to be celebrating Christmas. This holiday, long since forgotten by the Community, is associated in the novel with love, tradition, and a deep sense of family attachment. Jonas holds out hope that he can help the Community rejoin the broader world and open its eyes to the good and bad it has long tried to block out.