Do you know what is system Testing? If yes, then We carry out system testing in that Environment as listed in the requirement.
There is no such hard and fast rule for this, it depends on Testing strategy and vary with company to company.
But in general as folows: -
Entry Criteria: - All the Units of the software Application should be integrated and Sanity Testing should be pass. Requirement Environment/Data should be populated.
Exit Criteria: There is no bug that has seviority 1 & 2. and Testing is complete as per the Test Plan.
Google Session based testing by John Bach. He has written some good articales and suggestions on how to make it more organized and track what was tested and trace it back to defects found in the software.