While other Pauline writings see death or sin as the power that has held humanity in its grip, in this text the enemy of authentic human life is "the ruler of the power of the air," presumably the devil (see Ephesians 6:11-12). Human beings have followed this one, and the result is the state of being "dead through our trespasses."
God's response to this situation is characterized by mercy and love. God intervenes in the human condition, making human beings alive together with Christ and seating them "in the heavenly places in Christ Jesus." The metaphor echoes Psalm 110:1 ("The LORD said to my lord, 'Sit at my right hand until I make your enemies your footstool'") and so connects human experience to an Old Testament image that is otherwise used in the New Testament exclusively to describe Christ.
The text also echoes a Pauline theme that this new life is a gift and not a cause for boasting (see 1 Corinthians 1:26-31); it ends by noting that human beings have been "created in Christ Jesus for good works." In a few verses, then, this passage reports the move from human life characterized by sin to human life characterized by good works. The intervention that makes this move possible is God's merciful action to connect human beings to the living and exalted Christ described in Ephesians 1:20-21.
2You were dead through the trespasses and sins 2in which you once lived, following the course of this world, following the ruler of the power of the air, the spirit that is now at work among those who are disobedient. 3All of us once lived among them in the passions of our flesh, following the desires of flesh and senses, and we were by nature children of wrath, like everyone else. 4But God, who is rich in mercy, out of the great love with which he loved us 5even when we were dead through our trespasses, made us alive together with Christ*by grace you have been saved 6and raised us up with him and seated us with him in the heavenly places in Christ Jesus, 7so that in the ages to come he might show the immeasurable riches of his grace in kindness towards us in Christ Jesus. 8For by grace you have been saved through faith, and this is not your own doing; it is the gift of God 9not the result of works, so that no one may boast. 10For we are what he has made us, created in Christ Jesus for good works, which God prepared beforehand to be our way of life.
New Revised Standard Version Bible: Anglicized Edition, copyright © 1989, 1995 National Council of the Churches of Christ in the United States of America. Used by permission. All rights reserved worldwide. http://nrsvbibles.org