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Venice is literally an island -- or to be more precise, a cluster of over one hundred small islands. It is part of the northeastern Italian region known as the Veneto. The city consists of six districts, called sestieri: Cannaregio, Santa Croce, San Polo, San Marco, Castello, and Dorsoduro (see TripAdvisor's Neighborhoods page). Venice is unique among modern cities in that its primary form of public transportation is...boats. No buses, no cars, no subways. How cool is that?
The city was founded in 421 A.D., by residents of the Veneto area fleeing the never-ending attacks of the Visigoths (who only ten years prior had sacked Rome); Venice's isolated location proved ideal in avoiding the brunt of the barbarians. At this point in history, the Roman Empire was falling apart and was increasingly under attack from everyone from the Goths to Attila the Hun.
Over the next 400 years, through battles and new powers establishing themselves (most notably, the Holy Roman Empire) Venice slowly prospered and began establishing itself as an independent entity: La Serenissima, The Most Serene Republic. Because the Venetians wanted a cool patron saint, in 829 A.D. some merchants got the crazy idea of stealing the body of Saint Mark from its tomb in Alexandria, Egypt. It is this saint's symbol that now dominates Venice: a winged lion, a statue of which stands proudly atop a column in the Piazzetta that leads into the famed and beautiful Piazza San Marco.
The key to Venice's prosperity during these early days was the fact that it was a major trade route between the ports of the East (like Alexandria and Constantinople) and the rest of Europe. Despite clashes with its major rival, Genoa, and ongoing political intrigues, Venice thrived well into the 1400s. The fall of Constantinople in 1453, however, spelled the long beginning of the end for the republic. Losing their mercantile power and influence, Venice started becoming what it is today: a beautiful tourist carnival, the honorary capital of decadence and excess. And as other Italian cities flourished artistically during this time, so did Venice: see the birth and emergence of important artists like Bellini, Carpaccio, Tintoretto, Veronese, Tiepolo, and Canova.
By the end of the 1790s, though, poor Venice was being punted about between Napoleon and the Austrians. Napoleon, who appears to have never liked the city that much anyway, let the Austrians have it. Venice was under Austrian rule until 1848, when the population rebelled. A scant twenty years later, they joined the newly formed Italian Kingdom--Venice's amazing 900-year history as an independent republic was, sadly, at an end. And that leads up to the modern day, to Venice's place of honor as a major tourist destination throughout the world.