The undead's beginnings upon Azeroth did not truly begin with the corruption of Prince Arthas-it began long before that event. The events that brought downfall of Lordaeron were long set in motion before that point; it began with the coming of the orcish clans and the Burning Legion.
The orcs of Draenor (the world which they originally came from) were noble and shamanistic. They were powerful warriors, strong of body and will. It was for these reasons that the Burning Legion sought them out. Kil'jaeden, a demon of great power among the Legion, wished to enslave the orcish clans and use them as his army against the worlds the Burning Legion had yet to conquer.
Kil'jaeden came to the leader of the clans, a powerful shaman named Ner'zhul. He promised Ner'zhul untold mystical power and knowledge if he made a pact with the demon that would enslave the clans to the Burning Legion. This pact sealed not only their fate, but that of their world forever.
As time passed, Ner'zhul realized the fate of the clans at the hands of the Burning Legion, and the orc shaman began to defy Kil'jaeden. The demon, angered by Ner'zhul, turned to the shaman's own apprentice, Gul'dan, who was far more corruptible than Ner'zhul.
It was Gul'dan who was responsible for the decline of shamanism throughout the clans. The promise of power and control over one's enemies made his offers even more tempting. With Kil'jaeden's help, Gul'dan began his manipulation of the clans. The orcs, once noble, became corrupt, mindless savages. With the introduction of demon blood into their bodies, the orcs were even more ruthless and barbaric.
Even though Kil'jaeden had corrupted Gul'dan after his failure with Ner'zhul, Kil'jaeden hated the shaman and vowed to enforce their original pact. Kil'jaeden captured Ner'zhul and began an incredibly slow physical torture on the shaman. While Ner'zhul begged for death, Kil'jaeden reminded Ner'zhul that their original pact was still binding. Kil'jaeden killed the orc, but only physically. Kil'jaeden held the orc shaman's spirit fast before it could find its way to the Twisting Nether.
Kil'jaeden placed Ner'zhul's spirit within a block of ice gathered from the Twisting Nether. While it was trapped within the ice, he infused into it even more power. The loss of his body and the introduction of such incredible power was the defining line in Ner'zhul's transformation.
Kil'jaeden hurled the block of ice through dimensions back to Azeroth, where it landed in the continent of Northrend, introducing this great evil to our world. Ner'zhul was gone forever; in his place was a throne of ice and hatred. The once respected shaman leader had become the incredibly powerful Lich King.
Because Kil'jaeden did not trust the Lich King, he sent his dread lords to watch over the spirit and ensure that the Lich King followed his orders. The vampiric servants came to Azeroth willingly, drawn to the destruction and power of the Lich King and the potential genocide of a planet's entire race.
Over a decade passed. During this time, the Lich King used his vast powers to gain control over the minds of the creatures of Northrend, whom he commanded to erect a great citadel over his frozen throne. Now that all of Northrend was under his domination, the Lich King knew he needed to begin his infiltration of Lordaeron. Trapped within the ice, the former orc shaman began seeking more minds to manipulate and control. His call reached out across the continents.
The Lich King's summons did not go unnoticed, especially by a small handful of powerful individuals. Among them was the Archmage Kel'Thuzad, who was a powerful member of the ruling body of Dalaran, the Kirin Tor. His pursuit of all types of magic violated the Kirin Tor's policies against learning dark magics. Kel'Thuzad abandoned the Kirin Tor and all his ties to conventional thought and vowed to learn as much as he could from the Lich King.
A pact was struck between the two. Kel'Thuzad would receive immortality and immense power in return for servitude to the Lich King. Kel'Thuzad's first task was to use his wealth and influence in Lordaeron to found the Cult of the Damned. The Cult promised equality and eternal life to all its members as long as they swore an oath to Ner'zhul, the 'god' of the Cult of the Damned.
Ner'zhul then created artifacts that were designed to spread the plague among the human civilizations of Lordaeron. He gave them to Kel'Thuzad, and ordered the wizard to spread them across the land. His Cult followers were to protect the artifacts at all costs.
Once in place, the plague began to seep into the land and affect its ignorant citizens. As Kel'Thuzad watched, the Lich King's army grew quickly and he soon gained control over large portions of the land. This army became known as the Scourge, for its sole purpose was to scour humanity from all of Azeroth.