my personal methodology is the following, loosely based on God's creation of the world and subsequent events:
Pre-World: Cosmology: God, angels, demons, the "gods," heaven & hell, the nature of man, the nature of the world; Geography: how big is your world? How many zones do you want? Prior to the Seven Days of Creation, the globe already existed, albeit covered with water. At least, that's what we're told it looked like.
2. DAY ONE: Time: night & day, is the game time faster or the same as our reality?
3. DAY TWO: Weather cycles, if any
4. DAY THREE: Land Masses & Oceans; Vegetation
Mineral Kingdom: deposits of metal ore, useful minerals (salt, coal, etc), stone,
generally, crystals & jewels are found in mines, but not always
Vegetable Kingdom: Grasses, including grains for food and flax for clothes
Herbs, including vegetables, tea, tobacco, hemp (for rope)
Trees, for fruits, nuts, timber, some spices,
5. DAY FOUR: Sun, Moon, Stars & Planets; seasons, weekly & yearly schedules
6. DAY FIVE: Creatures of the Water & Creatures of the Air
7. DAY SIX: Reptiles, "Bugs," and Peoples (includes all sentient races)
AFTER THE FALL....
1. Sin & Death, what are the rules?
2. Weaponry (Cain & Abel); Music, Crafting, Farming, Clothes, etc
4. Magic & Religion, spirituality, prophecy
5. Giants & Monsters (if any)
7. Natural Disasters
AFTER THE FLOOD
8. the Nations & Cities of the World; their cultures
9. the Languages of the World
10. the Special People & Scriptures, if any
A THOROUGH WAY TO MAKE A HISTORY (this should involve some dice):
For each sentient race that has it's own civilization, make 9 categories for 9 leaders within that civilization: the King, the High Priest; the Master Mason; the Miller; the Hero; the Master Smith; the Wizard; the Warlord; the Bard. Each leader will rule from 10 to 60 years (one variable). Each leader's greatness will range from "the Great & Good" to simply average to "the Terrible & Wicked" (variable two). Great Kings expand civilization, and create laws. The Priests lead nations towards or away from God. Masons build monuments (including Wonders, and dungeons). Millers will determine the agricultural & population level. Heroes are legendary adventures. Smiths make special items (the better the number of the smith, the better military equipment the nation will have at that time). Wizards discover magic, teach people, create monsters. Warlords win battles (if a goblin army's stats exceed a human army's, guess who wins?). Bards determine cultural influence, morale, and morality. Start the chart when the civilization begins, for as long as you wish. Interpret the numbers as you will: a good hero might overthrow an evil king, or an evil "hero" or warlord might overthrow a bad one. Likewise, a wizard may send a hero on a quest. The hero's equipment will be determined by his own number, plus the smith's, plus the cleric's (for a blessing), plus the wizard's (for an enchantment). This will mean that some relics will be more valuable than others. The various numbers can be combined to represent various aspects of the civilization. For instance, the mason's number may also represent the value of labor, meaning the higher the number the greater production of sawmills, quarries, and mines.
A good thing to do is read an atlas of the ancient world, or some such other book, to get a feel for all the variety of civilizations, from the sea-faring Phoenicians & Polynesians, to the agriculturally dependent Indians & Egyptians, to the barbaric Celts & Zulus, to the militarized Spartans & Japanese. Another recommendation is watching Spike TV's "Deadliest Warrior" to see what ancient weapons were really capable of. There are some surprises--the famous Japanese Samurai sword, the Katana, which can eviscerate up to three people at once in the hands of a master, can't remotely slice through something like Viking chain mail. Not so surprising: in their heyday, the ancient Spartans were probably the best warriors in history, before they became bogged down in their own military traditions, and lost the flexibility required to defend themselves against the Romans.
edit: on creating the histories, I always give a special +1 bonus of greatness to each leader, if their king is "Great." My fantasy mmo design completely avoids creating a history by including time & death in the game, so that the players themselves create the history of the fantasy world, with their adventures, wars, & creations.
Edit 2: Mene, a most capable programmer, could probably come up with a random value generator to help you (or anyone else) create the history. I would advise not letting the computer interpret the numbers, as the necessary drama would require a personal touch.
Then said Jesus unto the twelve, "Will ye also go away?" Then Simon Peter answered Him, "Lord, to whom shall we go? Thou hast the words of eternal life. And we believe and are sure that Thou art that Christ, the Son of the Living God." John 6:67-69