Starting Somewhere Near the beginning (A Rough Sketch)
Old Stone Age - Hunter Gatherers
Right back, when humans started to take stock of their situation, with knowledge of a difference between them and the natural World, they started to interact with their environment in a special way.
Perhaps it was about this time that they'd first bitten into the Forbidden Fruit and swallowed and Adam had had a fruitful relationship with lillith (the original demon-woman)?
Anyway, as hunters and gatherers they didn't just chase and dig, they danced and sung and drew and carved, but with purpose. That purpose was to get under the skins and into the hearts of their quarry, to think like them and to know their ways.
Sometimes they would have significant experiences with certain plants, or animals, or materials, or places in their new conscious World which would set those plants, animals, rocks, streams, or mountains apart. They might even think that they'd had a meeting with the intrinsic Spirit of those things. This might be seen as an ancestor Spirit, that set our ancestors apart as a group. A totemic ancestor, an animal, plant, or thing, special and magical. These might even be identified as the magical, spiritual, "Ancestors" of the people, or tribe, from around the misty times of their creation.
Soon, interaction with such 'Ancestor Spirits' would be that magical warrior, the shaman's domain, although in most early societies, most young people would have to meet the ancestor spirit, or spirits, at some point along the way.
Nomads, and Mounds
So, rocket forwards a few thousand years, give, or take. Tribes of extended family units are traversing well worn paths, chasing their seasonal harvests, and meeting up at special points, cross roads, or crossing tracks at preselected and special times of the year, which can be predicted and act as a focus for the meeting up of the various tribal groups, to exchange gifts and young partners.
Perhaps, just for the sake of argument, they also bring the bodies, or bones of their recently departed and somewhere near these meeting places and crossing points they will be buried with their fellow tribe members.
Special mounds and cairns are built, where the shamen perform the ancient songs, dances and stories of their tribe, going back to the Creation and the Ancestor Spirits.
New Stoneage Farmers Versus Nomads
Some of the groups stop travelling and settle down on the best land, developing new technologies of agriculture and food processing. After a while, they start to view the still nomadic, herders and semi-hunter gatherers with growing suspicion. A split develops between the two groups.
The opportunities for a fully hunter gatherer lifestyle are becoming less bountiful as the free land becomes encroached by the new farmer settlers. The hunter-gatherer nomads try to stick to the old ways, but they are forced, more and more, to resort to what now amounts to theft and rustling. Inter-tribal wars and small, but devastating, genocides result.
The nomadic folks slowly die out, unable to compete against the technologies and entrenched strength of the neolithic farmers. However, ancient memories and beliefs, persist, knowledge of the strange and alien customs of these folks persist.
Then there are the burial mounds and the the memories of the shamanistic knowledge of the realms of the Ancestor Spirits, which some have called, "The Happy Hunting Grounds" which are also called, "Annwyn," or "Hades," or "Avalon," or "Elfland", or "Faerie."
Before there was a "Heaven," or, for that matter a separate and distinct "Hell," there was an other place. The Place of the Ancestors. Reached through magical portals, be it a hearth fire, or a sacred pool, or grove, or by interment in a stone and earthen mound (perhaps a representation of the belly of Mother Earth?).
Many of the magical laws and ways ascribed to human interaction with the Realm of Elfin, could just as easily be ascribed to Shamanistic interactions with the Realms of the Ancestors.