Baltic peoples probably lived on the eastern shore of the Baltic Sea more than 4,000 years ago. Between 800 and 1150 A.D., raids by such groups as the Vikings and Russians caused the Letts to organize for defense, thus hastening the development of tribal government. German merchants of the Hanseatic League came in the 12th century. In the early 1200's, a German crusading order conquered the pagan Letts and founded the state of Livonia in what is now northern Latvia and southern Estonia. The Livonian Knights, as the order came to be known, was absorbed by the Teutonic Knights in 1237. The Teutonic Knights had earlier conquered Kurland (or Courland), the region south and west of Livonia.

In 1561 Poland wrested control of Livonia and Kurland from the Teutonic Knights. Sweden in turn seized Livonia from Poland in 1629. Russia gained Livonia from Sweden in 1721 and Kurland from Poland in 1795.

During the centuries they were ruled by foreign overlords, the Letts, most of whom were peasants, managed to maintain their national identity and language. In the late 1800's, czarist attempts to impose Russian language and culture on the Letts aroused nationalistic sentiments.

Latvia—consisting of part of Livonia and most of Kurland—declared itself independent in 1918. Its independence lasted only until 1940, when Latvia was invaded by the Soviet Union and made a union republic of that nation. Germany occupied the country from 1941 until 1944, when it was retaken by the Soviets. More than 100,000 Letts fled to Western Europe and the United States.

After World War II, the Soviets carried out large-scale deportations of Letts to other parts of the Soviet Union and settled Russians in their place. Industry developed rapidly after the war, and in 1949 the Soviet government ordered the merging of all Latvian farms into collectively owned units.

In the 1970's a Latvian nationalist movement arose. At first the government tried to suppress it but in the late 1980's became more tolerant. The Communist party's monopoly on political power was abolished by Latvia's parliament in 1989. In 1990 the parliament voted in favor of declaring independence from the Soviet Union and called for negotiations to prepare for Latvia's secession. The Soviet Union, however, rejected Latvia's declaration. During 1990–91 the Soviet government gradually lost its authority over the union republics. In September, 1991, Latvia was granted independence and became a member of the United Nations.

Since independence Latvia has struggled with the status of ethnic Russians, who make up nearly one-third of the population. In 1994 it passed a law restricting citizenship to speakers of Latvian. The legislation was criticized by Russia, the European Union, and the United States. In 1998, voters approved a referendum repealing it. A new law was passed in 1999 that required Latvian to be the sole official language of the country. In 2004, Latvia became a member of both NATO and the European Union.