The "Masters of Space and Time", as the Doctor thought of them, were powerful non-corporeal life forms. They originally had physical bodies but over millions of years evolved into beings of pure energy dwelling in the void of space. They could communicate telepathically, hypnotise others and create material objects with the power of their minds.
After millions of years in this state, the beings grew weary of being the ultimate in evolution and desired to return to having physical bodies again. They began collecting individuals from across the Milky Way and placed them in a habitat they created, where they scanned their minds and recorded their knowledge, which they would use to create a new galaxy for them to inhabit. Among the individuals taken by the beings were the Second Doctor, Jamie McCrimmon and Victoria Waterfield. They became intrigued by the Doctor's ability to temporarily make his mind blank, and told him and his companions their history and intentions. When Victoria felt pity for them, this reminded them of the emotions they had left behind along with their bodies and asked her to tell them more; she replied that love was the most important emotion of all. Having learned what they needed, and after being persuaded not to keep Victoria with them against her will, they returned everyone home with no memory of their time in captivity and left to create their new galaxy, which they intended to name after the girl who had taught them so much. (PROSE: Mastermind of Space)