Stockholm's location appears in Norse sagas as Agnafit, and in Heimskringla in connection with the legendary king Agne. The earliest written mention of the name Stockholm dates from 1252, by which time the mines in Bergslagen made it an important site in the iron trade. The first part of the name (stock) means log in Swedish, although it may also be connected to an old German word (Stock) meaning fortification. The second part of the name (holm) means islet, and is thought to refer to the islet Helgeandsholmen in central Stockholm. The city is said to have been founded by Birger Jarl to protect Sweden from a sea invasion by foreign navies and to stop the pillage of towns such as Sigtuna on Lake Mälaren.
Stockholm's core of the present Old Town (Gamla Stan) was built on the central island next to Helgeandsholmen from the mid-13th century onward. The city originally rose to prominence as a result of the Baltic trade of the Hanseatic League. Stockholm developed strong economic and cultural linkages with Lübeck, Hamburg, Gdańsk, Visby, Reval, and Riga during this time. Between 1296 and 1478 Stockholm's City Council was made up of 24 members, half of whom were selected from the town's German-speaking burghers.
The strategic and economic importance of the city made Stockholm an important factor in relations between the Danish Kings of the Kalmar Union and the national independence movement in the 15th century. The Danish King Christian II was able to enter the city in 1520. On 8 November 1520 a massacre of opposition figures called the Stockholm Bloodbath took place and set off further uprisings that eventually led to the breakup of the Kalmar Union. With the accession of Gustav Vasa in 1523 and the establishment of a royal power, the population of Stockholm began to grow, reaching 10,000 by 1600.
The 17th century saw Sweden grow into a major European power, reflected in the development of the city of Stockholm. From 1610 to 1680 the population multiplied sixfold. In 1634 Stockholm became the official capital of the Swedish empire. Trading rules were also created that gave Stockholm an essential monopoly over trade between foreign merchants and other Swedish and Scandinavian territories.
In 1710 a plague killed about 20,000 (36 percent) of the population. After the end of the Great Northern War the city stagnated. Population growth halted and economic growth slowed. The city was in shock after having lost its place as the capital of a Great Power. However Stockholm maintained its role as the political centre of Sweden and continued to develop culturally under Gustav III.
By the second half of the 19th century, Stockholm had regained its leading economic role. New industries emerged and Stockholm was transformed into an important trade and service centre as well as a key gateway point within Sweden. The population also grew dramatically during this time, mainly through immigration. At the end of the 19th century, less than 40% of the residents were Stockholm-born. Settlement began to expand outside the city limits. The 19th century saw the establishment of a number of scientific institutes, including the Karolinska Institute. The General Art and Industrial Exposition was held in 1897.
Stockholm became a modern, technologically advanced, and ethnically diverse city in the latter half of the 20th century. Many historical buildings were torn down during the modernist era, including substantial parts of the historical district of Klara, and replaced with modern architecture. However, in many other parts of Stockholm (such as in Gamla Stan, Södermalm, Östermalm, Kungsholmen and Vasastan), many "old" buildings, blocks and streets built before the modernism and functionalism movements took off in Sweden (around 1930-1935) survived this era of demolition. Throughout the century, many industries shifted away from work-intensive activities into more high-tech and service industry areas.
Between 1965 and 1974, the city expanded very quickly with the creation of additional suburban districts such as Rinkeby and Tensta as a part of the Million Programme. Many of these areas have been criticized for being "concrete suburbs", dull, grey, low-status areas built mainly out of concrete slabs. The most common complaints are about the high crime rate and the high racial and social segregation in these areas.
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