His younger brother Isaac II Angelos, was threatened with execution under orders of their first cousin once removed Andronicos I Comnenos on September 11, 1185. Isaac made a desperate attack on the imperial agents and killed their leader Stephanus Hagiochristophorites. He then took refuge in the church of Hagia Sophia and from there appealed to the populace. His actions provoked a riot, which resulted in the deposition of Andronicus I, and the proclamation of Isaac II Angelus as emperor. Alexius was now closer to the imperial throne than ever before.
To compensate for this crime and to solidify his position as emperor, Alexios had to scatter money so lavishly as to empty his treasury, and to allow such licence to the officers of the army as to leave the Empire practically defenceless. He consummated the financial ruin of the state. In 1195, Holy Roman Emperor Henry VI forced Alexios III to pay him a tribute of 1,000 pounds of gold (originally 5,000 pounds of gold). The able and forceful empress Euphrosyne Ducaena Camatera tried in vain to sustain his credit and his court; Vatatzes, the favourite instrument of her attempts at reform, was assassinated by the emperor's orders.
In the east the Empire was overrun by the Seljuk Turks; from the north Bulgarians and Vlachs descended unchecked to ravage the plains of Macedonia and Thrace, and Kaloyan of Bulgaria annexed several important cities, while Alexius squandered the public treasure on his palaces and gardens and attempted to deal with the crisis through diplomatic means. The emperor's attempts to bolster the empire's defenses by special concessions to Byzantine and Bulgarian notables in the frontier zone backfired, as the latter built up regional autonomy. Byzantine authority survived, but in a much weakened state.
The crusaders, whose objective had been Egypt, were persuaded to set their course for Constantinople before which they appeared in June 1203, proclaiming Alexios as emperor and inviting the populace of the capital to depose his uncle. Alexius III took no efficient measures to resist, and his attempts to bribe the crusaders failed. His son-in-law, Theodore Lascaris, who was the only one to attempt anything significant, was defeated at Scutari, and the siege of Constantinople began. Unfortunately for Constantinople, Alexius III's misgovernment had left the Byzantine navy with only 20 worm-eaten hulks by the time the Crusaders arrived.
In July, the crusaders, led by the aged Doge Enrico Dandolo, scaled the walls and took control of a major section. In the ensuing fighting, the crusaders set the city on fire, ultimately leaving 20,000 people homeless. Alexios III finally took action, and led 17 divisions from the St. Romanus Gate, vastly outnumbering the crusaders. But his courage failed, and the Byzantine army returned to the city without a fight. His courtiers demanded action, and Alexius promised to fight. Instead, that night (July 17/18), Alexios III hid in the palace, and finally, with one of his daughters, Eirene, and such treasures (1,000 pounds of gold) as he could collect, got into a boat and escaped to Develton in Thrace, leaving his wife and his other daughters behind. Isaac II, drawn from his prison and robed once more in the imperial purple, received his son in state.
At first Alexios III received Alexius V well, even allowing him to marry his daughter Eudocia Angelina. Later Alexios V was blinded and deserted by his father-in-law, who fled from the crusaders into Thessaly. Here Alexius III eventually surrendered, with Euphrosyne, to Marquis Boniface of Montferrat, who was establishing himself as ruler of the Kingdom of Thessalonica.
Trying to escape Boniface's "protection", Alexius III attempted to seek shelter with Michael I Ducas, the ruler of Epirus, in 1205. Captured by Boniface, Alexius III and his retinue were sent to Montferrat, before being brought back to Thessalonica c. 1209. At that point the deposed emperor was ransomed by Michael I of Epirus, who sent him to Asia Minor, where Alexios' son-in-law Theodore I Lascaris of the Empire of Nicaea was holding his own against the Latins.
Here Alexios III conspired against his son-in-law after the latter refused to recognize Alexius' authority, and received the support of Kay Khusrau I, the sultan of Rüm. In the battle of Antioch on the Maeander in 1211, the sultan was defeated and killed, and Alexius III was captured by Theodore Lascaris. Alexius III was relegated to a monastery at Nicaea, where he died later in 1211.
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