D&D 5E Homebrewing a Setting, advice?

Don't expect your players to suddenly share your level of interest and passion about the setting and don't try to overload them with grand histories and other overwhelming levels of detail.
A lot of good advice so far, but I'd like to echo this in particular. I don't know your group, and they may be different. But my general experience with players has been that if you start out by dropping a large amount of worldbuilding detail on them -- a big list of new races, cultures, places, concepts, and so on -- they're not going to have that assimilated immediately and they're going to gravitate towards familiar stuff. In short: giving them the race options of human, quellick, woodwose, horekh, or myrmidon is a very good way to get a party of humans. They don't know what the heck a "quellick" is, a paragraph or so of description in an introductory handout is unlikely to get them excited about it, and more than a paragraph or so is unlikely to be read.

This doesn't mean they're uninterested in the setting, though. The excitement just has to be built up organically over time through engagement with the world. Interacting with a quellick NPC for a while is as effective as reading an introductory handout isn't. Really, this is just the same advice that applies to writers: show, don't tell; avoid exposition dumps. You're telling if you present too much worldbuilding to the players up front. Let them start small and basic, and from that starting point you can show.
 

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Oh: on a mechanical front, race design is easy. Notwithstanding the narrative caveats, go wild. I would be very cautious, though, with designing new classes. Start with maybe a new subclass or two for the existing classes, and see how that goes.

Also, your players spent good money on their PHBs, and most likely expect to be able to use them. So if you were thinking (and I'm not saying that you are) about doing something like kicking wizards to the curb and changing the spellcasting system to better fit your world's metaphysics... that might not be the best idea. Think in terms of additions, not modifications or subtractions.
 

Point 1: The "start small" is a major piece. That doesn't literally mean just create one little village. You can start mapping out large chunks of your world, do some notes on various cultures, even draft some crazy new magic system used by the star elves (or whatever) that live on the next continent. What "start small" really means (IMO/IME) is that you shouldn't paint yourself into a corner. As others have said, your players' characters are the stars. If you ever get to the point where it's painful for you to add/change something to let the character personalities show through, your setting is done. The story has run its course.

To put it in a slightly different light, the old novelist adage about "kill your darlings" doesn't apply to RPGs the way it does to a novel. In an RPG, the players are your audience. If you build something that you love, there's a better than fair chance that the PCs will try to steamroll right through it the second you put it on display. They might not even wait long enough for the full exposition. They definitely won't care about the three pages of history for it. Where you'll see success with cool concepts is by watching which way the PCs have interest, then introducing things that play well with that. Killing your darlings for dramatic effect -- or even just because you realized you've gotten too attached to them -- is one thing. It's completely different to see your darlings stillborn due to player whim or have to quietly take them out back and shoot them.

That's why I support the "start small" line. Make a bunch of notes for cool ideas. You don't have to place them. You don't even have to use them all for this setting. Just don't bring them to life until they have a good home. Your world must be able to grow and adapt to your players.

Point 2: Your players don't care as much about your setting as you do and they never will. Ever. Seriously. Never. Unless you're playing with a very unusual group of players, they're not going to learn the names of more than a handful of gods or cities, let alone the various family trees that bind either together. Even when you have those players (and I have), it'll just prompt you to do even more detail on those things until you've hit the player's tolerance. That's not bad. It's your baby, not his. I generally can't remember all the Wizard PC's spells, so why should I expect him to remember the favored weapon of nine gods and the crest of three orders of knighthood?

Heck, I rearranged the continents on my world map three times during the stay of a couple players (it was several years between). No one even noticed that the grey elves went from being east of the core play area to the west. I was just happy that they finally knew that Lithselinori was the home of the grey elves and remote. Also, hobgoblins come from the desert, but no one remembers the name of the state.

Point 3: I wouldn't use the same world in which I was setting a novel -- unless the goal is to shape the world before writing the novel. The demands are significantly different because the game is interactive. Even when playing in an existing setting (say, Star Wars), I pick and choose canon, especially as it relates to contemporary "NPCs". My tack is to more "reimagine" those settings such that they resemble the source about as much a JJ Abrams' Star Trek resembles Rodenberry's -- similar themes, technology, etc. but different principals.

All this goes back to the key of PC agency and not doing too much throw-away (or even counterproductive) work.
 

Oh: on a mechanical front, race design is easy. Notwithstanding the narrative caveats, go wild. I would be very cautious, though, with designing new classes. Start with maybe a new subclass or two for the existing classes, and see how that goes.

Also, your players spent good money on their PHBs, and most likely expect to be able to use them. So if you were thinking (and I'm not saying that you are) about doing something like kicking wizards to the curb and changing the spellcasting system to better fit your world's metaphysics... that might not be the best idea. Think in terms of additions, not modifications or subtractions.
This is all true. If you're going to go heavily narrativist, D&D might not be the best choice, especially for magic. You can kind of smooth it over for straight-up stories, but it's very gamist. Even Hero can be tweaked to be more flavorful, but I'd go with something like Fate or Savage Worlds. Shadowrun might work, as could a conversion of Mage: The Awakening or reskinning Ars Magicka.

If you really want to get crazy on bringing narrative ideas to play, finding a copy of Aria: Roleplay might be ideal.

That prompts the thought that Aria: Worlds is a fabulous tool for any world builder, too.
 

Heck, I rearranged the continents on my world map three times during the stay of a couple players (it was several years between). No one even noticed that the grey elves went from being east of the core play area to the west. I was just happy that they finally knew that Lithselinori was the home of the grey elves and remote. Also, hobgoblins come from the desert, but no one remembers the name of the state.
Funny, that's one thing I could never get away with. My players adore maps.

Point 3: I wouldn't use the same world in which I was setting a novel -- unless the goal is to shape the world before writing the novel. The demands are significantly different because the game is interactive. Even when playing in an existing setting (say, Star Wars), I pick and choose canon, especially as it relates to contemporary "NPCs". My tack is to more "reimagine" those settings such that they resemble the source about as much a JJ Abrams' Star Trek resembles Rodenberry's -- similar themes, technology, etc. but different principals.
Yes. Most settings have to change to accommodate D&D rules and expectations. Most obviously, the aforementioned magic system.
 

A lot of good advice so far, but I'd like to echo this in particular. I don't know your group, and they may be different. But my general experience with players has been that if you start out by dropping a large amount of worldbuilding detail on them -- a big list of new races, cultures, places, concepts, and so on -- they're not going to have that assimilated immediately and they're going to gravitate towards familiar stuff. In short: giving them the race options of human, quellick, woodwose, horekh, or myrmidon is a very good way to get a party of humans. They don't know what the heck a "quellick" is, a paragraph or so of description in an introductory handout is unlikely to get them excited about it, and more than a paragraph or so is unlikely to be read.

I want to play a Myrmidon.
 

Man, some of you have directly opposite experiences from me on this stuff.

IME, most players will care a great deal about any halfway detailed setting that isn't a clone of another setting. They dig into the history of the guild they're a part of, or the kingdom they come from, they remind me of things I've forgotten about the world, even.
 

I want to play a Myrmidon.
Four arms, lean and muscular, dark or reddish skin, 90% female population, strict caste system, fiercely territorial, tend towards pragmatism over ideals. +2 Strength, +1 Dexterity, +1 Constitution, free Athletics proficiency, one extra reaction each round. Four arms do not allow extra attacks or alter the rules for dual-wielding, but are handy in lots of other ways.
 

Four arms, lean and muscular, dark or reddish skin, 90% female population, strict caste system, fiercely territorial, tend towards pragmatism over ideals. +2 Strength, +1 Dexterity, +1 Constitution, free Athletics proficiency, one extra reaction each round. Four arms do not allow extra attacks or alter the rules for dual-wielding, but are handy in lots of other ways.

Like dual wielding a pair of two handed weapons?
 

IME, most players will care a great deal about any halfway detailed setting that isn't a clone of another setting. They dig into the history of the guild they're a part of, or the kingdom they come from, they remind me of things I've forgotten about the world, even.
They do... eventually. They don't absorb all that from your campaign document prior to session one; they absorb it through actual play.
 

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