The Oxford English Dictionary defines a Dystopia as "an imaginary place or society in which everything is bad." Merriam-Webster goes a step farther, and calls it "an imaginary place where people lead dehumanized and often fearful lives."
On one end of the idea spectrum, we have Utopias, where everything is good and right and everyone lives in peace and harmony. On the precise opposite side, we have the Dystopian visions where the world is dark and fearful, and the powerful use the weak until they are dried up like day-old bread. Dystopias are police-states, fascist nations, and places where the forces of evil are in power oppressing all those who would resist them.
First-World Steampunk, where the story takes place in an alternate point of our own history, focuses quite heavily on dystopian settings. The Difference Engine by William Gibson and Bruce Sterling takes place in a dystopia brought on by terrorists who want to eradicate the new high technology of the meritocracy. These Luddites craft an environment of anarchy and terror that they believe will bring Britain back to the pastoral Utopia they so crave.
Whitechapel Gods by S.M. Peters operate solely within a dystopia. The "gods" of the title rule over the human citizens of the Whitechapel district of London with steam-driven force. They steal children in the night for work in the factories, and have mechanized soldiers who enforce their martial law on the populace.
Jules Verne wrote a dystopia, Paris in the 20th Century, which went unpublished for more than a hundred years. The story was written in 1863, but was only published in 1994. In it, he told a story of Paris in 1960, where technology and business were the only things shown any value, and art and music had become extinct. The hero, Michel, strives to be a poet, but he is born too late and dies when he finds it impossible to fit in.
H.G. Wells, who wrote the dark side of Scientific Romance, also composed some dystopian tales. His The Time Machine details a future society where the Eloi are kidnapped by the Morlocks and used up in the same way many dystopian governments do to their people. Wells also wrote When The Sleeper Wakes, which details a future dystopia where the leaders of society are hedonistic and shallow.
Even Jack London, more famous for The Call of the Wild, offered up a dystopian novel in The Iron Heel (1908), where he details the rise of the Oligarchs and their command over North America.
To Steampunk, dystopian fiction accentuates the terror crafted by adherence to Gothic literature and the dark side of Scientific Romances. Boneshaker tells of a dystopia within the walls of ruined Seattle; Whitechapel Gods does the same with London; and The Affinity Bridge's slums may as well be a microcosm of the worst sort of dystopia. That where monsters the government is powerless to stop rule the streets.
Thursday: Jack London's The Iron Heel