The Little Friend is set in Alexandria, Mississippi, in the mid-1970s, and the novel also refers to events that took place in previous decades. The novel’s historical and physical setting shape aspects of the plot and character dynamics, especially concerning race, socioeconomic class, and gender. The protagonist is a 12-year-old white girl from an upper-class family that now has less money than it used to in the past. Her family members resent people of color, working-class white people, and Northerners, whom they blame for their relative “misfortune.” The family’s attempts to glorify the past result in exacerbated prejudices toward groups that are “othered.”

After the Civil War and Reconstruction, the American South was racially segregated until the practice was formally outlawed in 1964. The novel takes place after public schools were integrated, but Harriet and her white counterparts attend private school, thereby resegregating the schools themselves since most Black children in town attend public school. This trend was common at the time and still exists in some areas. The racial dynamics in the novel are such that even working-class white families like the Ratliffs forego other necessities to pay tuition for private school, which they really can’t afford.