On October 28th, 1988 the Mega Drive was released in Japan.
Like all of Sega's consoles, it was tailored to provide accurate ports of their arcade games. Sonic wouldn't grace the machine for nearly 3 years.
These were the golden years for Sega, and it can mostly be attributed to Tom Kalinske who was in charge of their American division. He made the decision to market it head-to-head against Nintendo, a task thought impossible by the competitors at the time. By the mid-90's, Kalinske began having disputes with their Japanese management. Sega Japan wanted to scrap the Mega Drive and focus 100% on the Saturn, while Kalinske thought the 16-bit generation still had a lot of selling power. These disputes ended with Kalinske leaving the company and the disastrous compromise known as the 32X. Since then, Sega has failed to achieve its past prosperity.