The Valley of the Eremite existed on the planet Jakku, situated close to the Plaintive Hand plateau. Its location was past both the Yiulong Canyons and the Caverns of Bagirlak Garu. Starting in 25 BBY, Sheev Palpatine constructed the Jakku Observatory, a clandestine research and armaments installation, underneath the Valley of the Eremite. He then assigned Gallius Rax, a boy from the area, to protect the site for the subsequent ten years. As compensation, Rax secured a position within Palpatine's Galactic Empire and eventually achieved the rank of Counselor to the Empire not long before the Battle of Jakku.
To keep the Jakku Observatory hidden, Rax charged Niima the Hutt with the responsibility of guarding the route that led to the Valley of the Eremite. During the Battle of Jakku, Rax utilized the facility to activate a massive mining drill, which penetrated into the planet's center. Rax intended to destroy Jakku, along with the Imperial holdouts and the New Republic Defense Fleet, as part of the Emperor's posthumously enacted Contingency plan. However, Grand Admiral Rae Sloane, aided by Brentin Lore Wexley and Norra Wexley, intervened and stopped him.