From Final Fantasy Wiki

Cocoon artwork.

"Cocoon. A paradise crafted by the inscrutable fal'Cie some thirteen centuries past."

—Game Trailer

In the world in Final Fantasy XIII, the continent of Cocoon (コクーン Kokūn) floats in the sky above the land of Pulse (aka Gran Pulse) like a low-hanging moon, with a large piece taken out of it, giving a view of the hollow inside, where the inhabitants of Cocoon actually live, on the inside of the shell. It is a futuristic paradise protected by advanced technology against the supposed intruders from the planet below. It is ruled by the Sanctum and its army, PSICOM.

Cocoon is said to be built by the fal'Cie to protect humanity from the rest of Pulse. It contains futuristic cities, such as the capital city of Eden, the port city of Palumpolum, the beach city Bowdam, and the the amusement park Nautilus. There are also expansive highroads located in the Hanged Edge, the exotic nature reserve of the Sunleth Waterscape, and a lake called Bilge located at the bottom parts of Cocoon. However, due to the fall of the Pulse fal'Cie, the water of the lake has been changed into a crystalline matter.

Despite their loathing and fear of the planet below, the people of Pulse see them as the potential intruders and source of evil in the world.

Trivia

• The game's logo depicts Vanille, Fang, and Ragnarok holding the crystallized Cocoon at the game's ending.