She was the guardian of the clocktower in Halloween Town, charged with protecting and maintaining it, along with flipping the counter everyday before she lost her heart to a Heartless when they swarmed the town.
Created by Dr. Finklestein to replaced the previous clock-keeper, Lya was a rag-doll animated by ectoplasm, lightening and a recently deceased soul.
The soul used for her is of unknown origins, but young age.
After being cared for by Sally, and choosing her own name, she was shown the clock tower and how to care for it and was left alone and rarely left the tower, except when her stitches unraveled or her fabric tore to get repaired.
On the day of her first Halloween, the Shadow Heartless Jack had once again (ill-advisedly) tried to include in the festivites ran rampant throughout the town scaring off the citizens. Lya left the tower in worry, telling the swarming Heartless to stop ruining the holiday, and was promptly attacked by one.