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Contemporary Madrid came into its own after the death of the Fascist dictator Franco. Years of the Franco regime left Madrid and much the country in economic shambles due to isolation. With his death, Madrid and Spain as a whole began to re-assert itself on the international stage. Within Spain, reaction against the dictatorial bureaucracy centered in Madrid and a history of centralism that pre-dated Franco by centuries has resulted in the successful modern movement towards increased autonomy for the regions of Spain, considered as European regions, under the umbrella of Spain.

At present, Spain is a constitutional monarchy, and is comprised of 17 autonomous communities. One of the most important problems facing Spain today is ETA's terrorism - this illegal organization defends Basque independence through violent means, which is condemned by both Central and Basque government, although there is tension between these governments since PNV (the party presently governing Basque Country) longs for greater autonomy from Spain, including the possibility of independence, something Spanish government doesn't accept.

As the Roman empire declined, the Suebi, Vandals and Alans each took control of part of Hispania. In the 5th century AD the Visigoths, a romanized germanic tribe, conquered all of Hispania and established a relatively stable kingdom lasting until 711, when it fell to an invasion by Islamic North African Moors and became part of the expanding Umayyad empire, under the name of Al-Andalus. When the Umayyad empire gave way to the Abbaside empire, an Umayyad exile established the Caliphate of Cordoba, effectively making Al-Andalus independent from the empire.

Spain remained officially neutral in World Wars I and II, but suffered through a devastating Civil War (1936-39). During Franco's rule, Spain remained largely economically and culturally isolated from the outside world, but slowly began to catch up economically with its European neighbors. Under Franco, Spain actively sought the return of Gibraltar by the UK, and gained some support for its cause at the United Nations. During the 1960s, Spain began imposing restrictions on Gibraltar, culminating in the closure of the border in 1969. It was not fully reopened until 1985.

Spain suffered a shocking terrorist attack, the March 11, 2004 Madrid attacks on its capital's commuter train network, killing 200. Al-Qaeda has been blamed for this attack. Some have attributed the fall of the Aznar government to this attack, which took place just two days before the 2004 elections. At first the public believed ETA was responsible for the bombing. When they learned Al-Qaeda was the true culprit, many voters lashed out at the media and Aznar's government, believing the two had colluded to deceive the public.

Through a policy of alliances with other European nobility and the conquest of most of South America and the West Indies, Spain began to establish itself as an empire. The Treaty of Tordesillas, negotiated by Pope Alexander VI between Portugal and Spain, effectively divided up the non-European world between these two budding empires. Massive amounts of gold and silver were imported from the New World into Spain's coffers. However, in the long run this hurt the Spanish economy much more than it helped it. The bullion caused high inflation rates, which undermined the value of Spain's currency. Additionally, Spain became dependent on her colonies for income, and when Queen Elizabeth I of England began to capture Spanish vessels on the way to and from the New World, Spain suffered massive economic losses. These effects, combined with the expulsion of Spain's most economically vital classes in the late 15th century (the Jews and the Moors), caused Spain's economy to collapse several times in the 16th century, bringing the Golden Age of Spain to a close.

The dry weather of Spain resulted in the importance of water fountains in Spanish urban design. In addition, ceramics figure prominently in architecture throughout Spain, especially in the tile roofs and the use of decorative tiles known as azulejos.

The Napoleonic invasion gave the opportunity to the American colonies, led by Libertadores, to claim their independence. Between 1810 and 1824, Chile, Colombia, Ecuador, Venezuela, and the other colonies declared and won their independence. The only New World colonies Spain was left with were the islands of Cuba and Puerto Rico. The Allies fought Napoleon's forces in the Peninsular War, with Joseph Bonaparte ruling as king at Madrid. In 1812 the Cortes took refuge at Cádiz and created the first modern Spanish constitution, the Constitution of 1812 (informally named La Pepa).

Terrorism is a problem of present-day Spain, since ETA (Basque Homeland and Freedom) is trying to achieve Basque independence through violent means, including bombings and murders. Although Basque Autonomous government does not condone any kind of violence, the different approaches to the problem are a source of tension between Central and Basque governments. Besides ETA violence, the conflict in the Basque Country is also shaped by the non-acceptance on the part of the spanish state of the right of basque people to choose freely their political status. Recently, 2 political parties - which in previous elections had received the support of around 15% of the popular vote- have been banned due to their negative to condemn publicly ETA violence in the terms that the main spanish political parties wanted.

The Romans arrived in the Iberian peninsula during the Second Punic war in the 2nd century B.C., and annexed it under Augustus after two centuries of war with the Celtic and Iberian tribes and the Phoenician, Greek and Carthaginian colonies becoming the province of Hispania. Some of Spain's present languages, religion, and laws originate from this Roman period.