Nepal's recorded history began with the Kiratis, who arrived in the 7th or 8th century BC from the east. Little is known about them, other than their deftness as sheep farmers and fondness for carrying long knives. It was during this period that Buddhism first came to the country; indeed it is claimeds that Buddha and his disciple Ananda visited the Kathmandu Valley and stayed for a time in Patan. By 200 AD, Buddhism had waned, and was replaced by Hinduism, brought by the Licchavis, who invaded from northern India and overthrew the last Kirati king. The Hindus also introduced the caste system (which still continues today) and ushered in a classical age of Nepalese art and architecture.

By 879, the Licchavi era had petered out and was succeeded by the Thakuri dynasty. A grim period of instability and invasion often referred to as the `Dark Ages' followed, but Kathmandu Valley's strategic location ensured the kingdom's survival and growth. Several centuries later, the Thakuri king, Arideva, founded the Malla dynasty, kick-starting another renaissance of Nepali culture. Despite earthquakes, the odd invasion and feuding between the independent city-states of Kathmandu, Patan and Bhaktapur, the dynasty flourished, reaching its zenith in the 15th century under Yaksha Malla.

The rulers of Gorkha, the most easterly region, had always coveted the Mallas' wealth. Under the inspired leadership of Prithvi Narayan Shah, the Gorkha launched a campaign to conquer the valley. In 1768 - after 27 years of fighting - they triumphed and moved their capital to Kathmandu. From this new base the kingdom's power expanded, borne by a seemingly unstoppable army, until progress was halted in 1792 by a brief and chastening war with Tibet.

Further hostilities followed in 1814, this time with the British over a territorial dispute. The Nepalese were eventually put to heel and compelled to sign the 1816 Sugauli Treaty, which surrendered Sikkim and most of Terai (some of the land was eventually restored in return for Nepalese help in quelling the Indian Mutiny of 1857), established Nepal's present eastern and western boundaries and, worst of all, installed a British `resident' in the country.

The Shah dynasty continued in power during the first half of the 19th century until the ghastly Kot Massacre of 1846. Taking advantage of the intrigue and assassinations that had plagued the ruling family, Jung Bahadur seized control by butchering several hundred of the most important men while they assembled in the Kot courtyard. He took the more prestigious title Rana, proclaimed himself prime minister for life, and later made the office hereditary. For the next century, the Ranas and their offspring luxuriated in huge Kathmandu palaces, while the remainder of the population eked out a living in medieval conditions.

The Rana's antiquated regime came to an end soon after WW II. In 1948, the British withdrew from India and with them went the Ranas' chief support. Around the same time, a host of insurrectional movements, bent on reshaping the country's polity, emerged. Sporadic fighting spilled onto the streets and the Ranas, at the behest of India, reluctantly agreed to negotiations. King Tribhuvan was anointed ruler in 1951 and struck up a government comprised of Ranas and members of the newly formed Nepali Congress Party.

But the compromise was shortlived. After toying with democratic elections - and feeling none too pleased by the result - King Mahendra (Tribhuvan's son and successor) decided that a `partyless' panchaayat system would be more appropriate for Nepal. The king selected the prime minister and cabinet and appointed a large proportion of the national assembly, which duly rubber-stamped his policies. Power, of course, remained with only one party - the king's.

Cronyism, corruption and the creaming-off of lucrative foreign aid into royal coffers continued until 1989. The Nepalese, fed up with years of hardship and suffering under a crippling trade embargo imposed by the Indians, rose up in popular protest called the Jana Andolan or `People's Movement'. In the ensuing months, detention, torture and violent clashes left hundreds of people dead. It all proved too much for King Birendra, in power since 1972. He dissolved his cabinet, legalised political parties and invited the opposition to form an interim government. The panchaayat system was finally laid to rest.

The changeover to democracy proceeded in an orderly, if leisurely, fashion, and in May 1991 the Nepali Congress Party and the Communist Party of Nepal shared most of the votes.

Since then, Nepal has discovered that establishing a workable democratic system is an enormously difficult task - especially when it is the country's first such system. The situation has been further exacerbated by a wafer-thin economy, massive unemployment, illiteracy and an ethnically and religiously fragmented population that continues to grow at an alarming rate.