Building Worlds

How do you do it?

I'm designing a world for my group which consists of four nations, mostly peaceful, with barbarian hordes to the north and "ogre kingdoms" smack-bang in the middle. Restricted almost totally to the four races in the playtest packet.

I like planning things, but I'm not sure how much detail to go into until we start playing in the world.
The reccomendations I tend to see most often online, and my own personal preference, is to not worry so much about specific city names, names of leaders, etc for every place in the world, but rather start with the town or region that your PC's will be starting in and then branch out from there as needed. I'd say for the other nations (that is the nations they AREN'T starting in) you don't need much more to begin with than a name and maybe a short sentence describing something about the nation. 

Something like this: "The Merchant is from [Country A], and distrusts people from [Country B] because of a war the two had some time ago."
Like Jollybutcher said, don't worry about the other nations.  Give some basic information about them or some foreshadowing from them if that is where you want to send players.  Something like "Kingdom A had some diplomatic issues with the ogres, war might be coming".  

Have some of the locals (NPC's) fleshed out like the tavern owner, supplier, local thief and maybe the priestess at the temple.  Have a rival adventuring group maybe who is higher level talk to them from time to time.

Have a short history of the kingdom, the name of the Lord of the land and the local knight.  The taxman is always a hassle, maybe he is very mean, rough and haughty.  Ask your players the questions first to see how they see the town then fill in the blanks.  Then pull it all together with your beginning adventures.  Don't do to much details as your players will run away from it and they always do unexpected stuff.

Have the stats of some local guards and bandits and you should be good. 
+1 +1

What you will find often is that it's easier to invent it on the fly as the campaign gets going, too.  The flow of the players' interactions with the small area of focus they start in will almost always inspire you, as a DM, towards new developments in your world.  Events, personalities, and histories that will mesh well with the group's dynamics and personality (as a collective).

Of vital importance, though, is that you keep notes on what you do and invent, as well as those moments of inspiration that helps your world bloom.

I would, however, suggest creating a few tidbits of particular flavor and detail for your world that you can mix in to make it distinct and more than a generic setting for the players.  Even if it's just allusions to something beyond the characters' scope that they hear only in rumor that's not important (these attacks upon the township I say are the works of the storm elves that do their evils from a floating forest of lightning and hate that circles the Dragon's Teeth mountains to the north).  It could be something they'll deal with quite often (the captain of the town guard is a bugbear with a very unique tale of how it came to pass) to something unusual (King Argred has outlawed the riding of horses).  It could be something personal (at 15 years of age, every citizen, male or female, must join the king's armor in service for one year - allowing backgrounds of training or even outlawry) or global (the world has two suns, one said to actually be a fiery world of damnation).  Etc.

At any rate, just let it come naturally, don't worry about it too much, and remember that it'll come easier with time and experience. 
Yes start locally always and build from there through play. Steal outragiusly from player musings about the world as well.
I like as a personal style to write the history/relations completely obvioudly biased from the first nations point of view. I find thhlat provokes more curiousity about the world than straight honest boring facts.
There are people who can start big and work down, but for the majority of us it's usually better to start small and work up. It allows you to concentrate more on the details you want in an area rather than having to worry about the details of the nation as a whole.

Even Ed Greenwood (The original designer of Forgotten Realms) started with a few small areas and worked his way out. It works. 
My two copper.
As someone mentioned earlier, always look for opportunities to improvise, as well.

Fairly early into one of my campaigns, while I was still fleshing out the details of the world, an exchange between the PC's and an NPC led to me narrating (completely improvised) some backstory of the small nation they were in, explaining how the people of that city had become frustrated with the continuing war of their sovereign nation against another nation, and that they had declared their independence and neutrality in the war.

Bam! Some history established, just off the top of my head. Not super original, but doesn't always have to be. I think Chris Perkins something along the lines of "don't be afraid to steal from any source".
I would recommend a series of articles 'building a fantasy sandbox' It's not a simple guide but rather a step-by-step manual to occupy your free time for a month or two
That is actually incredibly helpful, hirou. Thank you for linking that!
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