AC 187: A nameless war orphan with long chestnut hair and cobalt-blue eyes wanders onto Colony V08744 at LaGrange point 2 (L2). A street gang of other war orphans adopts the nameless boy. The gang's leader is a boy named Solo, the oldest of the group.
V08744 is a multinational colony plagued by cultural clashes and periodic rebellions against the occupying Alliance military. It is a place of poverty, oppression, hardship and despair - even water is rationed, bathing and washing clothes on a regular basis are luxuries only afforded to the rich.
Later that same year (exact timeframe is unknown, could be days, weeks or months), a virus breaks out on the colony (no doubt due to overcrowding/sanitation issues). A vaccine/cure is quickly developed and distributed to military personnel and their families and sold to those colonists who can afford it. When Solo falls deathly ill, our nameless orphan breaks into an Alliance hospital and steals the antidote but Solo's condition is too far advanced and the gang leader dies.
Before he passes, Solo tells the cobalt-eyed boy that he wishes they'd been able to spend more time together. The other orphan declares they'll always be together and adopts the name Duo in honor of his fallen friend. (There is nothing official, that I know of, indicating what pilot 02's name was before he started calling himself Duo.) Duo distributes the rest of the antidote to the other members of the street gang but takes none himself, intending to die with his friend Solo. Duo, however, never gets sick and is elected the new gang leader.
Sometime after Solo's death (again no specific timeframe is known, could be days, weeks or months), the entire street gang is taken in by Maxwell Church. The local Church is run by Father Maxwell (a priest) & Sister Helen (a nun). Sister Helen tries to cut Duo's hair because she considers it unsanitary and he pitches a fit as only a seven-year-old boy can. (Due to the water shortage/rationing, the Church is only allotted a regular supply of drinking water and Father Maxwell and Sister Helen are forced to collect rain/snow water for bathing & washing clothes.) Father Maxwell tells Sister Helen not to cut Duo's hair and she braids it for him instead - Duo seems quite happy with this and comments that now he can steal things and it won't get in his way.
The other children from the gang are eventually adopted into families but Duo keeps getting sent back to Maxwell Church, presumably for fighting. Father Maxwell and Sister Helen send Duo to an Alliance school open to the colonists so he can get an education. Duo is the top student in his class, though he does seem to get into a lot of fights - Sister Helen asks Duo why he put some children in the hospital and he tells her they were making fun of him and said that he smelled bad.
Father Maxwell doesn't seem to mind Duo getting into fights and tells Sister Helen that if he can just get a good education, Duo can become the best priest the world has ever seen. (It is unclear if Father Maxwell ever shared this ambition with Duo.) This is an interesting comment since Duo tells Father Maxwell that he doesn't believe in God, though he does belive in Shinigami (the Shinto God of Death). When Sister Helen, apparently horrified, asks why, Duo says he's never seen a miracle but he's seen lots of dead people.
AC 188: A group of rebel colonists stage an uprising on V08744 and hole up in Maxwell Church with their wounded. When Father Maxwell says they shouldn't fight but should follow Heero Yuy's example of total pacifism, the rebels accuse the Father and Sister of being Alliance spies. Duo, upset that the war has invaded his new home and threatened his new family, makes a deal with the rebels, saying he'll steal them a mobile suit if they'll go away and leave the Church alone. Duo breaks into an Alliance base and steals a mobile suit but when he gets back there is nothing but smoking rubble and broken bodies to greet him. Sister Helen, injured and bleeding, tells Duo she's glad he's all right and that she and Father Maxwell were worried about him. She asks God to bless and keep him, and then she dies. 245 people were killed in what became known as the "Maxwell Church Massacre".
AC 192: Howard and Professor G (both members of the Sweepers) hide a large spaceship on the North Pole of the Moon. Howard says he's going to Earth and the two engineers part ways. The crew on Professor G's ship discovers a stowaway. Duo's famous introduction makes it's first appearance here: "I run and I hide, but I never lie; Duo Maxwell!" Professor G asks if that's like Maxwell's Demon and Duo replies, "I'm not a demon; I'm Shinigami!"
AC 195: "Operation Meteor," planned by Dekim Barton and coordinated by Quinze, is in its final stages of preparation. The objective is to drop a colony on the Earth and then send the five Gundams to seize control of the crippled planet. Not wanting Deathscythe to be used in a massacre, Duo tries to blow up the Gundam but Professor G disarms his bombs, suggesting Duo steal Deathscythe instead of destroying it. He tells Duo to go to Earth as the God of Death and that Howard, a Sweeper on the Pacific Ocean, is a man that Duo can trust.
AC 195, April 7: The five Gundams descend to Earth in an altered form of "Operation Meteor". Thus begins Episode 1 of the series.
Sources: translations of Episode Zero manga & Endless Waltz (OAV/movie & translations of novelization)