From the game:
The standard setting for Dive into the Sky is assumed to be a sort of other-world, inhabited by the spirits of well-known and much-loved military hardware. It's organized into vague countries, and characters are presumably on one side or another in some form of large-scale war. As in Ace Combat, aircraft are not limited by country of origin, and MiGs will be seen happily fighting alongside American aircraft. The various nations are separated by ideological differences, and presumably locked in warfare.
The military of each side of this conflict is as strange as one might expect. Rather than simple weapons of war, vehicle and pilot are one and the same. They live on bases, in a vaguely military lifestyle, and spend their off time hanging around, visiting areas off-base if they have leave, or otherwise occupying their time as your particular gaming group sees fit.