At the beginning of this era the territory known today as Latvia became famous as a trading crossroads. The famous "route from the Vikings to the Greeks" mentioned in ancient chronicles stretched from Scandinavia through Latvian territory via the River Daugava to the ancient Rus and Byzantine Empire.
The ancient Balts of this time actively participated in the trading network. Across the European continent, Latvia's coast was known as a place for obtaining amber. Up to and into the Middle Ages amber was more valuable than gold in many places. Latvian amber was known in places as far away as Ancient Greece and the Roman Empire. In the 10th century AD, the ancient Balts started to form specific tribal realms. Gradually, four individual Baltic tribal cultures developed: Couronians, Latgallians, Selonians, Semigallians (kurši, latgaļi, sēļi, zemgaļi). The largest of them was the Latgallian tribe, which was the most advanced in its socio-political development. In the 12th and 13th centuries, the Couronians maintained a lifestyle of intensive invasions that included looting and pillaging.
On the west coast of the Baltic Sea, they became known as the "Baltic Vikings". But the Selonians and Semgallians, during this time, were known as peace-loving and prosperous farmers.
At the end of the 12th century, Latvia was more often visited by traders from western Europe who set out on trading journeys along Latvia's longest river, the Daugava, to Russia. At the very end of the 12th century, German traders arrived and with them came preachers of the Christian faith who attempted to convert the pagan Baltic and Finno-Ugrian tribes to the Christian faith. The Balts did not willingly convert to the new and different beliefs and practices, and particularly opposed the ritual of baptism. News of this reached the Pope in Rome and it was decided that Crusaders would be sent into Latvia to influence the situation.
The Germans founded Riga in 1201, and gradually it became the largest city in the southern part of the Baltic Sea. With the arrival of the German Crusaders, the development of separate tribal realms of the ancient Latvians came to an end.
In the 13th century, the Livonian Confederation developed under the Germanic authorities consisting of Latvia and Estonia. In 1282, Riga and later Cēsis, Limbaži, Koknese and Valmiera were included in the Northern German Trading Organisation, or the Hanseatic League (Hansa). From this time, Riga became an important point in west-east trading. Riga, being the centre of the eastern Baltic region, formed close cultural contacts with Western Europe.
The 1490s were a time of great changes for the inhabitants of Latvia, notable for the reformation and the collapse of the Livonian nation.
Ferdinand I, Holy Roman Emperor once again asked for help of Gustav I of Sweden, and The Kingdom of Poland (1385–1569) also began direct negotiations with Gustavus, but nothing resulted because on September 29, 1560, Gustavus I Vasa died. The chances for success of Magnus and his supporters looked particularly good in 1560 (and 1570). In the former case he had been recognised as their sovereign by The Bishopric of Ösel-Wiek and The Bishopric of Courland, and as their prospective ruler by the authorities of The Bishopric of Dorpat; The Bishopric of Reval with the Harrien-Wierland gentry were on his side; Livonian Order conditionally recognised his right of ownership of Estonia (Principality of Estonia). Then along with Archbishop Wilhelm von Brandenburg of The Archbishopric of Riga and his Coadjutor Christoph von Mecklenburg, Kettler gave to Magnus the portions of The Kingdom of Livonia, which he had taken possession of, but they refused to give him any more land. Once Eric XIV of Sweden became king he took quick actions to get involved in the war. He negotiated a continued peace with Muscovy and spoke to the burghers of Reval city. He offered them goods to submit to him as well as threatening them. By June 6, 1561 they submitted to him contrary to the persuasions of Kettler to the burghers. The King's brother Johan married the Polish princess Catherine Jagiellon. Wanting to obtain his own land in Livonia, he loaned Poland money and then claimed the castles they had pawned as his own instead of using them to pressure Poland. After Johan returned to Finland, Erik XIV forbade him to deal with any foreign countries without his consent. Shortly after that Erik XIV started acting quickly lost any allies he was about to obtain, either from Magnus or the Archbishop of Riga. Magnus was upset he had been tricked out of his inheritance of Holstein. After Sweden occupied Reval, Frederick II of Denmark made a treaty with Erik XIV of Sweden in August 1561. The brothers were in great disagreement and Frederick II negotiated a treaty with Ivan IV on August 7, 1562 in order to help his brother obtain more land and stall further Swedish advance. Erik XIV did not like this and The Northern Seven Years' War between The Free City of Lübeck, Denmark, Poland, and Sweden broke out. While only losing land and trade, Frederick II and Magnus were not faring well. But in 1568 Erik XIV became insane and his brother Johan III took his place. Johan III ascended to the throne of Sweden and due to his friendship with Poland he began a policy against Muscovy. He would try to obtain more land in Livonia and exercise strength over Denmark. After all parties had been financially drained, Frederick II let his ally, King Sigismund II Augustus of Polish-Lithuanian Commonwealth, know that he was ready for peace. On December 15, 1570, the Treaty of Stettin was concluded. It is, however, more difficult to estimate the scope and magnitude of the support Magnus received in Livonian cities. Compared to the Harrien-Wierland gentry, the Reval city council, and hence probably the majority of citizens, demonstrated a much more reserved attitude towards Denmark and King Magnus of Livonia. Nevertheless, there is no reason to speak about any strong pro-Swedish sentiments among the residents of Reval. The citizens who had fled to The Bishopric of Dorpat or had been deported to Muscovy hailed Magnus as their saviour until 1571. The analysis indicates that during the Livonian War a pro-independence wing emerged among the Livonian gentry and townspeople, forming the so-called "Peace Party". Dismissing hostilities, these forces perceived an agreement with Muscovy as a chance to escape the atrocities of war and avoid the division of Livonia. That is why Magnus, who represented Denmark and later struck a deal with Ivan the Terrible, proved a suitable figurehead for this faction.
The Peace Party, however, had its own armed forces – scattered bands of household troops (Hofleute) under diverse command, which only united in action in 1565 (Battle of Pärnu, 1565 and Siege of Reval, 1565), in 1570 – 1571 (Siege of Reval, 1570-1571; 30 weeks), and in 1574 – 1576 (first on Sweden’s side, then came the sale of Wiek to the Danish Crown, and the loss of the territory to Muscovites). In 1575 after Muscovy attacked Danish claims in Livonia, Frederick II dropped out of the competition as well as the Holy Roman Emperor. After this Johan III held off on his pursuit for more land due to Muscovy obtaining lands that Sweden controlled. He used the next two years of truce to get in a better position. In 1578, he resumed the fight for not only Livonia, but also everywhere due to an understanding he made with Rzeczpospolita. In 1578 Magnus retired to Rzeczpospolita and his brother all but gave up the land in Livonia.
In 1561 during the Livonian War, Livonia fell to the Grand Duchy of LithuaniaRobert Auty (1981). Companion to Russian Studies: Volume 1 Vol 1 Introduction to Russian History. Cambridge: Cambridge University Press. ISBN 0-521-28038-9.Szilvia Rédey, Endre Bojtár (1999). Liberalisation in the communist regime began in the mid 1980s in the USSR with the perestroika and glasnost instituted by Mikhail Gorbachev. In Latvia, several mass socio-political organisations were constituted that made use of this opportunity – Tautas Fronte (Popular Front of Latvia), Latvijas Nacionālās Neatkarības Kustība (The Movement for National Independence), and Pilsoņu Kongress (Citizen's Congress of Latvia). These groups began to agitate for the restoration of national independence.
On the 50th anniversary of the Molotov-Ribbentrop pact (23 August, 1989) to the fate of the Baltic nations, Latvians, Lithuanians and Estonians joined hands in a human chain, the Baltic Way, that stretched 600 kilometres from Tallinn, to Riga, to Vilnius. It symbolically represented the united wish of the Baltic States for independence.
Subsequent steps towards full independence were taken on May 4, 1990. The Latvian SSR Supreme Council, elected in the first democratic elections since the 1930s, adopted a declaration restoring independence that included a transition period between autonomy within the Soviet Union and full independence. On the August 21, 1991 parliament voted for an end to the transition period, thus restoring Latvia's pre-war independence. On September 6, 1991 Latvian independence was once again recognised by the USSR.
Soon after reinstating independence, Latvia, which had been a member of the League of Nations prior to WWII, became a member of the United Nations. In 1992, Latvia became eligible for the International Monetary Fund and in 1994 took part in the NATO Partnership for Peace program in addition to signing the free trade agreement with the European Union. Latvia became a member of the European Council as well as a candidate for the membership in the European Union and NATO. Latvia was the first of the three Baltic nations to be accepted into the World Trade Organization.
At the end of 1999 in Helsinki, the heads of the European Union governments invited Latvia to begin negotiations regarding accession to the European Union. In 2004, Latvia's most important foreign policy goals, membership of the European Union and NATO, were fulfilled. On April 2, Latvia became a member of NATO and on May 1, Latvia, along with the other two Baltic States, became a member of the European Union. Around 67% had voted in favor of EU membership in a September 2003 referendum with turnout at 72.5 percent.