To set up Sidekiq as the background job processor in a Rails app, first add the 'sidekiq' gem to your Gemfile and run 'bundle install' to install it. Then, configure your Rails application by setting 'config.active_job.queue_adapter = :sidekiq' in your application configuration file. Next, start the Sidekiq process using the command 'bundle exec sidekiq' to begin processing jobs. When you enqueue jobs using Active Job, they are sent to Sidekiq's queue and processed asynchronously in the background. Sidekiq must be running to pick up and execute these jobs. Without the Sidekiq gem installed or the process running, jobs will not be processed. This setup allows your Rails app to handle background tasks efficiently.