California; the 1960's
The action takes pace in California, a state where the northern and southern cultures are so different that some people have suggested they should be separate states. Ben's family lives in southern California, in an affluent suburb of Los Angeles. Elaine goes to school at Berkeley, across the bay from San Francisco and known as a hotbed of radicalism in the 60s. Her wedding to Carl takes place in Santa Barbara, somewhere in the middle—a place that if you've ever visited there, you're wondering why you're not moving there right this minute. (Hint: you can't afford it.)
Ben's Southern California is a land of wealth and pleasure, where parents can afford to buy their children expensive gifts like a scuba suit and Italian sports car. Berkeley, on the other hand, is a more intellectual and forward-thinking place, often on the political fringe. Benjamin's landlord, Mr. McCleery, complains about how he doesn't like those "outside agitators" and suspects Ben of being one. (During the 60s, there were a fair number of anti-war activists on college campuses who weren't members of the student body. That's who the landlord was referring to.)
The Graduate's version of Southern California is focused on the rich, preppy areas. We don't really see a broader cross-section of L.A. society; just the wealthy, college-educated social milieu in which Benjamin moves. Ben's father is an attorney who can afford to buy Ben an expensive sports car for a graduation gift. His male friends are professional people and their wives are traditional housewives. The character of Mrs. Robinson shows us the underside of this glittering life; the price she paid for being the wife of a wealthy attorney was the abandonment of her own dreams and interests.
Even though the film spends some time on the Berkeley campus, there are no signs of hippies or banners or political demonstrations, which would have probably been going on daily in 1967. Ben and Elaine, although they're planning their own personal rebellion, don't identify with that. There's a shot of Ben on an empty campus, sitting under an American flag. But he's not there for a revolution; he's got no real plan except to somehow find Elaine and convince her to marry him. (Source)