The sage Kashyapa had two wives, Diti and Aditi. From Diti the demons were born and from Aditi came the demigods. The demons also follow the Vedic ways of life under the guidance of their spiritual master, Sukracharya. It so happened that many times the demons took over the heavens and made the demigods flee in fear. Realizing the great danger, God takes an avatar to defeat the demons, relieves the demigods from fear and returns them back to the heavens. Many such accounts can be found in the Srimad Bhagavatam. To name but a few, we have Bali Maharaj and Hiranyakashipu.

When King Bali conquered the universe, the Lord appeared as Vamana and tricked him by asking merele for 3 steps of land. Sukracharya warned Bali but since he already promised he had to give. In the days of yore when someone would give his word, especially Kings, they were bound to act accordingly for truthfulness was a religious principle that was strictly followed. Then the Lord expanded Himself and covered the whole universe in two steps. That was how Bali was defeated. But since he kept his word and surrendered after being defeated, the Lord gave him eternal residence in the spiritual world with a planet just for himself.

Now one may ask a question. How can a demon conquer the universe when the demigods are extremely pious and have a lot of power? We should understand that the demons follow the Vedic culture. They worship their spiritual master with great awe and reverence. That is where their power comes from. By worshipping the spiritual master faithfully, one achieves all merits and unlimited power. It doesn't matter whether they were demons, what matters is that they follow the principle properly. Hiranyakashipu conquered everywhere due to the power he got from doing austerities and the boon he got from Lord Brahma. He was also a very good Brahmin. But when they cause disturbance in the universe they are killed by the Lord.

According to Srimad Bhagavatam the demons don't live in heavens. There's much suffering where they are. That is why they do austerities and temporarily conquer the universe every now and then. The high level of enjoyment on the higher planets attracts them. There is the famous story in the Bhagavatam where the demigods and demons agreed to churn the ocean of milk for nectar. When the nectar came up the demons, devious in their dealings, tried to run away with it. A fight broke and finally Lord Vishnu incarnated as a female to bewilder the demons and seize the nectar from them to hand it to the demigods. While fighting some drops of nectar fell in four places in India. In these four places the Kumbha Mela takes place every four years.

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