The drastic decline for the once noble planet started in 2651 with the Kretonian Invasion. Great cities such as Alhira were obliterated and those inhabitants who didn't die, enter cryogenic sleep to await a future rebellion, or flee with the B'hiri to the distant world of Pansheera ended up as slaves in mines.
By the time Sanctuary returned in 3000 from its voyage out of time in Hiverspace, Demarians were virtually extinct. Only those who traveled aboard Sanctuary remained to settle and rebuild amidst the ruins on Demaria.
The Time of Madness: ATRV and the Fall of the Imperator