Chile was originally under the control of the Incas in the north and the nomadic Araucanos in the south. In 1541, a Spaniard, Pedro de Valdivia, founded Santiago. Chile won its independence from Spain in 1818 under Bernardo O'Higgins and an Argentinian, José de San Martin. O'Higgins, dictator until 1823, laid the foundations of the modern state with a two-party system and a centralized government.  

The dictator from 1830 to 1837, Diego Portales, fought a war with Peru in 1836–1839 that expanded Chilean territory. Chile fought the War of the Pacific with Peru and Bolivia from 1879 to 1883, winning Antofagasta, Bolivia's only outlet to the sea, and extensive areas from Peru. Pedro Montt led a revolt that overthrew José Balmaceda in 1891 and established a parliamentary dictatorship lasting until a new constitution was adopted in 1925. Industrialization began before World War I and led to the formation of Marxist groups. Juan Antonio Ríos, president during World War II, was originally pro-Nazi but in 1944 led his country into the war on the side of the Allies.  

In 1970, Salvador Allende became the first president in a non-Communist country freely elected on a Marxist program. Allende quickly established relations with Cuba and the People's Republic of China, introduced Marxist economic and social reforms, and nationalized many private companies, including U.S.-owned ones. In Sept. 1973, Allende was overthrown and killed in a military coup covertly sponsored by the CIA, ending a 46-year era of constitutional government in Chile.

The coup was led by a four-man junta headed by Army Chief of Staff Augusto Pinochet, who eventually assumed the office of president. Committed to “exterminat[ing] Marxism,” the junta suspended parliament, banned political activity, and severely curbed civil liberties. Pinochet's brutal dictatorship led to the imprisonment, torture, disappearances, execution, and expulsion of thousands of Chileans. A government report in 2004 indicated that almost 28,000 people had been tortured during his rule, and that at least 3,200 murders and disappearances had taken place.

The economy, in tatters under Allende's Socialist revolution, gradually improved after Chile's return to privatization under Pinochet. In 1989, Pinochet lost a plebiscite on whether he should remain in power. He stepped down in Jan. 1990 in favor of Patricio Aylwin. In Dec. 1993, Eduardo Frei Ruiz-Tagle, the candidate of a center-left coalition and son of a previous president, was elected president.

Pinochet, who had retained his post as army commander in chief after the 1989 plebiscite, retired in March 1998. In Oct. 1998, he was arrested and detained in England on an extradition request issued by a Spanish judge who sought Pinochet in connection with the disappearances of Spanish citizens during his rule. British courts ultimately denied his extradition, and Pinochet returned to Chile in March 2000. He died in Dec. 2006 at age 91, before facing trial for the abuses of his 17-year dictatorship.

Ricardo Lagos became president in March 2000, the first Socialist to run the country since Allende. Chile's economic growth slowed to 3% for 2001, partly the result of a drop in international copper prices and the economic turmoil in neighboring Argentina. In 2003 there were several minor financial scandals involving insider information and bribery. In response, Lagos introduced new reforms promising greater transparency. In 2004, Chile passed a law permitting divorce for the first time.  

In 2006 presidential elections, Socialist Michelle Bachelet won 53% of the vote. The former pediatrician is a survivor of the Pinochet dictatorship, which was responsible for her father's death and subjected her to prison, torture, and exile. Bachelet took office on March 11, becoming Chile's first female chief of state. She promised to continue Chile's successful economic policies while increasing social spending. Her first major challenge came when 700,000 of the nation's students organized a national boycott in May demanding educational reform. The students called off the strike in June after the government agreed to address their concerns.