A Small English Village
Based on the small location references in Matilda, you might try to figure out the region of England that the book's probably set in. It's a trick worthy of the genius Matilda herself.
But other than those few references, we don't know much more than the fact that Matilda takes place in a small English village. And if that's all we get, maybe that's the whole point. The characters could be anywhere. The village, like the people who populate it—the Wormwoods and the other students at Crunchem—is ordinary. It's the opposite of Matilda. It's as normal and regular as she is "extra-ordinary" (1.7). There's nothing special here, folks, so let's move right along.
While we don't know much about the town itself, we do know about the places within it. And frequently, in Matilda, those places don't match the people who are inside them. Matilda's family home seems fairly comfortable. It has all the basics a cozy home should have covered, but the Wormwoods are so awful that the house doesn't really feel like a home to Matilda.
It's not about what her house has, it's about what the people in that house don't provide: "Mr and Mrs Wormwood were both so gormless and so wrapped up in their own silly little lives that they failed to notice anything unusual about their daughter. To tell the truth, I doubt they would have noticed had she crawled into the house with a broken leg" (1.7). In other words, it's not really a place where she can grow or where she feels safe.
On the other hand, check out Miss Honey's cottage. It's a run-down shack that reeks of poverty and of doing-without: "The room was as small and square and bare as a prison cell. […] The only objects in the entire room were two upturned wooden boxes to serve as chairs and a third box between them for a table. That was all" (16.60). This is not a nice place to live. But because Miss Honey is there, and because it's a place free from the Trunchbull and the Wormwoods, it becomes a place where Miss Honey and Matilda can grow to be a family. They can support and help each other there, despite their meager surroundings.