Tens of thousand years before the 14th century DR, the continent of Faerûn was a jungle, but after an ice age came, the Old Ones were all but wiped out. In order to sustain themselves, Morag and a handful of her subjects entered an alternate dimension via a magical device known as the Source Stone, which protected them from the cold.
In time, the city of Neverwinter was constructed over the area where the Source Stone lay. Morag desired to regain her power and turn the continent of Faerûn into a jungle once more, over which she would rule as of old.
In the Year of Wild Magic, 1372 DR, Maugrim, who had heard rumors of the Source Stone, discovered it and triggered the Wailing Death plague, which was a defense mechanism of the Source Stone. Although infected and dying, Morag used her power to heal Maugrim and told him of her ambitions. As she would gain power from those who died within the vicinity of the Source Stone, she commanded Maugrim to spread the plague throughout Neverwinter, which he did. After the execution of Fenthick, Morag began to appear to Aribeth de Tylmarande in her dreams, tempting her to defect to Maugrim's cause as a means of revenge against Neverwinter for seeking Fenthick's death. Aribeth eventually gave in, and agreed to lead a Luskan army in an attack on Neverwinter. Meanwhile, she also had Maugrim and his cult seek the four Words of Power, ancient Old One artifacts that contained magical power that Morag could use to free herself from the Source Stone. Though the Hero of Neverwinter succeeded in recovering three of these Words before Maugrim could, the one that Maugrim did find was the most powerful of all, and combined with the power that Morag had already gained from those who died of the plague and during the siege of Neverwinter, Morag regained enough power to break free of the Source Stone. After killing Maugrim and recovering the last Word of Power, in order to prevent Morag's return, the Hero used the four Words of Power to enter the Source Stone and confront Morag. In the ensuing fight, the hero killed Morag and the realm contained within the Source Stone began to implode. In order to save the Hero, Haedraline opened a portal to an "astral pocket" that allowed the Hero to escape from the Source Stone, and subsequently opened a portal that leds back to Faerûn.
Morag is the main antagonist in the original Neverwinter Nights campaign.