Last of the Mohicans is set in 1757 in the third year of a war in North America over land and territory. Mostly, the war is between the English and the French, but each side has taken up Indian allies to assist them. The main story in the Last of the Mohicans is the love of an adopted Mohican, Hawk-eye, and Cora, the daughter of an English general. There are also other stories embedded in the movie, which are harder to recognize. For instance, a second love story between Hawk-eye's brother and Cora's sister. The life of Magua is another story that the movie seems to slightly touch, but doesn't elaborate on.
As for the historical part of the movie, I think it is accurate in the sense of the fighting style of the English. The 'proper' way of war might be fine in Europe, but against the Indians, standing in a line with bright red coats is not the way to win.
'...the soldiers' uniforms splendid - though (and that's a historic fact) idiotically ornate and impractical for warfare. It wasn't until about 1916 that the British and the French saw the light and stopped wearing all that Day-Glo, easy target colors' (Prof. Jahiel). For example, at the beginning of the movie, Magua killed one soldier marching in the line, and the guy next to him didn't even do anything until the commander said to attack. They would also fire at the same time, leaving the whole squad vulnerable to attack while they reloaded. By fighting in this manner, it allowed the Indians to fight much more strategically. They would fire muskets three at a time, so they could stop an oncoming rush while the others reloaded. The Indians also took advantage of the English firing scheme.