The Black Ring started as a group of dark wizards who wished to summon the Lord of Chaos to end the world. However, another group of wizards opposed this plot, and joined forces with the various intelligent races of Rivellon, specifically Elves, Dwarves, Orcs, Imps, Lizardmen, and Humans. Together they created the Council of Seven and waged a war against the wizards of the Black Ring called the Wizard War. The Council was victorious, the dark lord of the Black Ring was defeated, and the other wizards were executed.
However, many of the Black Ring's fanatics escaped and continued their attempts to bring forth Chaos. Their second attempt was made by the then leader of the Black Ring, the Demon of Lies, who attempted to summon forth the Chaos Demon as well, but was stopped by Lucian the "Divine". (This struggle was the focus of the plot of the first game in the series, "Divine Divinity".) However, the ritual was successful and the Demon took the form of a small child, Damian. Lucian adopted Damian and hoped that his divine teachings coud help Damian contain the Demon and make him a powerfull tool of good instead of evil.
The Black Ring, however, was not yet defeated; when they learned of Damian, they sent the dark sorcerer Ygerna to him in secret to teach him of the Chaos that lurked in his soul. When Lucian discovered this plot and executed Ygerna, Damian flew into a rage, and joined the remnants of the Black Ring. Overjoyed, the Ring adopted the young man as their leader. Lucian and the mighty wizard Zandalor - who had assisted the Divine in his previous battle against the Demon of Lies - managed to capture Damian, but Lucian was unable to bring himself to kill him, and therefore banished Damian to the dimension Nemesis.
Without its leader, the Black Ring was again on the defensive, yet Damian was able to return to Rivellon to once more lead them in the Great War. Although the Black Ring was once again beaten back, this victory came at a terrible price: the death of Lucian the Divine, and the extinction of many of the old races.
Today the Black Ring is but a silent whisper under hushed breaths, but rumors are beginning to surface of its return. More ominous still, some say the Ring is preparing for a new war - a war that will shatter Rivellon and give birth to a new dark age ruled by the Damned One himself.