The film is set in Cambodia - the location of the genuine killing fields where the Khmer Rouge regime killed and buried masses of people from 1975 to 1979.
However, the movie was not filmed in Cambodia. It was instead shot at six locations: three Thai, two Canadian, and one American.
For more information on the killing fields, and totalitarian communist rule in Cambodia please see the following links:
http://www.edwebproject.org/sideshow/khmeryears/index.html
http://www.infoplease.com/spot/khmer1.html
http://www.dithpran.org/killingfields.htm
For more information on the 1984 film "The Killing Fields" please see http://www.imdb.com/title/tt0087553/.