Shang Mu is on the Brink of an energy crisis. With the stone in our hands, we could have solved it overnight!
- Zao, explaining to Team Lilac why he stole the Kingdom Stone
Shang Mu is one of the Three Major Kingdoms of Avalice, and is ruled by Mayor Zao, whose propaganda covers the streets. Shang Mu first began as a modest port city, but thanks to Zao's Administration, the city grew into a sprawling metropolis, making the rest of Avalice look like the Stone Age. There are strong implications that Zao had gained his position of power through means that are considered less-than-democratic, such as bribery or rigging the election. However, his cleverness may also be the reason why Shang Mu has grown into the most advanced nation on Avalice.
During the events of Freedom Planet, Shang Mu is met with an Energy Crisis, in which Zao becomes desperate to avert in order to preserve his city's power and assure his chances for re-election. He starts by hiring Spade, a member of the Red Scarves, to steal the Kingdom Stone, only to be framed for the murder of the Shuigang's King, followed by an attack on Shang Mu by the Sky Battalion.
In the 3 years after Lord Brevon's defeat, Shang Mu became far more advanced, as if becoming a futuristic city that makes the rest of Avalice look like the Stone Age. It also fell under the protection of Captain Kalaw, the Red Wing of Justice who also the became the reigning champion of the city's Battlesphere.