Story and origin
The Cetra (also known as the The Ancients), are an ancient race from a civilization that is almost completely exinct. Aerith was actually half cetra and is the last known descendant at the time of the events in the original game. The ancients have a unique genetic connection to nature and the lifestream. They look identical to humans and are believed to be the "stewards of the planet".
The ancients were historically a migratory race who traveled globally and cultivated the land. They had the ability to make the land fertile, which is demonstrated in Aerith's knack for growing flowers in Midgar. According to Sephiroth, modern humans are descendants of Cetra. These descendants eventually abandonded their migratory lifestyle and settled in permanent communities. Over time they lost their spiritual connection to the Planet.
About 2,000 years before the events of the main game, an extraterrestrial entity named Jenova crashed into the Planet via a meteorite. Jenova infected the Cetra with a deadly mutagenic virus, but a small band of survivors fought back. They were able to defeat Jenova and seal it away in the Northern Crater. Shinra scients later excavated Jenova and mistook the entity for a Cetra.
After Jenova was sealed away the Gi tribe arrived on the planet. The Cetra later discovered the Gi had created the black materia, which prevented the souls of the Gi from entering the lifestream. The Cetra hid the black materia to prevent it from being used. Ultimately, due to Jenova's manipulation, humans slaughtered the Cetra en masse. The remaining went into hiding, with their numbers gradually reduced to Aerith and Ifalna.
The Cetra became functionally extinct after the death of Ifalna and Aerith Gainsborough.
Etymology
A Cetra is stringed musical instrument widely used in ancient times. It is similar to a Lyre and constructed from wood. It's use spread from Greece and was used by a number of composers.
According to the Final Fantasy Wiki, the name Cetra may also derive from the Latin word cetera. It is the neuter plural form of the adjective ceterus (meaning "other" or "remaining"). Cetera is literally translated to "the other things".