The Nami were a nomadic species of sapients in the Outer Rim. Originally from the Galactic Core, they were driven into the Rim during the Clone Wars and largely forgotten. Years later, a female Nami leader named Ali Tarrak came to power. Forces under her command captured a prototype of the new TIE Defender starfighter produced by the Galactic Empire, and very nearly precipitated an arms race by attempting to sell that technology to the Rebels.
Tarrak's leadership had the benefit of excellent timing. The Empire was locked in a secret, but brutal, struggle against a rogue Grand Admiral, Demetrius Zaarin, who had developed a deadly new starfighter that outperformed even Lord Vader's TIE Advanced model. Zaarin had fled to the Outer Rim after destroying most of the Empire's TIE Advanced and TIE Defender production facilities, such as factory station ZA-13. The Empire's loyalist forces were fully engaged in recovering single starfighters from the attacks as best they could, which provided Tarrak the perfect opportunity to steal a specimen.
Tarrak's raid actually piggybacked off the actions of a separate group of pirates, the Rneekii, who were somehow able to snare loyalist forces in an elaborate ion cannon trap. (It is implied, though not stated, that Zaarin supplied the Rneekii with information needed to set up the trap.) Nami raiders boarded and captured Imperial craft carrying a single TIE Defender unit, and hyperspace to safety with it.
Tarrak also acquired the TIE Defender project's lead scientist after the Rneekii pirates ransomed him to the highest bidder near the Kiilimaar system. Tarrak knew the Empire would be the highest bidder, so she devised a plan with Imperial traitors under Zaarin's command. When the Empire went to Kiilimaar to pick up the scientist, Tarrak's forces attacked the Interdictor cruiser Red Claw carrying the scientist, disabling its hyperdrive using Magnetic Pulse technology.
The Red Claw's commander called in two Imperial corvettes for reinforcements. The first was to take the scientist to safety, the second would bring a team to repair the Red Claw. However, Zaarin sent in one of his own corvettes masquerading as the first, there to pick up the scientist, and claiming the second was delayed. One of Zaarin's strike cruisers provided cover for the corvette as it escaped with the scientist.
Zaarin then handed the scientist over to Tarrak, presumably under the assumption that she would produce TIE Defenders to use against the loyalist Imperial forces. Exactly what he stood to gain from this is uncertain - it is possible that Zaarin did not have factory facilities in the Outer Rim, and the Nami's factories could help compensate for that shortcoming.
Whatever the agreement between them, it is clear the Nami began construction of TIE Defenders, and it is likely that Tarrak reneged on it. She planned to sell some to the Rebel Alliance, a move that would almost certainly have outraged Zaarin, who continued to be staunchly anti-Rebel even during his own coup. However, it appears Zaarin was either powerless or unwilling to cross Tarrak's will, as he takes no further steps to stop her sale.
The Emperor, seeing the significance of the situation, and hoping to stop proliferation of the powerful starfighter, dispatched one of his best commanders to disrupt the deal, then-Admiral Thrawn. Thrawn oversaw the development of a new Imperial assault craft, the Missile Gunboat, which was specifcally developed to counter the TIE Defender. The Missile Gunboat was still an experimental craft, relying on a powerful tractor beam and a heavy warhead payload to immobilize and destroy enemies. It was a dramatic break away from the pattern of simply increasing the speed, cannons, and maneuverability - as seen in TIE Interceptor, Advanced, and Defender development.
Thrawn's forces captured Tarrak's Strike Cruiser before it could send any TIE Defenders to a Rebel Carrack Cruiser. Admiral Thrawn's Star Destroyer, the Grey Wolf, followed fleeing Nami forces to Tarrak's TIE Defender factory space station, whereupon he gave the now-famous order to Ace pilot Maarek Stele: "For the greater glory of the Empire, destroy everything!" The new Missile Gunboat took out the remaining Nami TIE Defenders, and the Star Destroyer Grey Wolf's TIE Bombers destroyed the factory. All Nami structures, down to the last mine, were destroyed.
During the final assault on the factory, Tarrak made a bold escape attempt, leaving the factory in a Corellian Transport with the lead scientist as a hostage. She even dared to threaten Thrawn, sending the message "Cease your attack or your precious scientist dies!" However, Thrawn successfully called her bluff, assuring Tarrak that such an action would guarantee her own death.
Ultimately, Tarrak spared the life of the scientist, as Assault Gunboats disabled her vessel. After her capture, Tarrak was sent to Coruscant, where she would be trained to serve the Emperor. Deprived of their production centers and their leader, the Nami species sank back into obscurity, and Thrawn's later triumph over Zaarin ensured Imperial supremacy in the region. The Emperor promoted Thrawn to Grand Admiral shortly after his victory over Tarrak, and the successful containment of a potentially uncontrollable TIE Defender proliferation.
Species notes: The Nami are likely to be Human sized, if not Humans themselves, as they can comfortably fly TIE Defenders produced exactly to Human pilots' standards. Tarrak's voice over the radio commlinks in the game TIE Fighter sounds very Human and accentless (and is in fact one of the only female voices in the entire game).