Stockholm, capital and largest city of Sweden. Stockholm is located at the junction of Lake Mälar (Mälaren) and Salt Bay (Saltsjön), an arm of the Baltic Sea, opposite the Gulf of Finland. The city is built upon numerous islands as well as the mainland of Uppland and Södermanland. By virtue of its location, Stockholm is regarded as one of the most beautiful capital cities in the world.

Stockholm was first mentioned as a town in 1252 and was largely built by the Swedish ruler Birger Jarl. It grew rapidly as a result of a trade agreement made with the German city of Lübeck. This agreement ensured Lübeck merchants freedom from customs charges for their trade in Sweden, as well as the right to settle there. The city came to be officially regarded as the Swedish capital in 1436. After conflicts between the Danes and Swedes for many years, Stockholm was liberated from Danish rule by Gustav I Vasa in 1523.

Stockholm developed rapidly in the mid-17th century as Sweden temporarily became a great power. The central government departments were then placed there, and the city became an independent administrative unit. The old city walls were torn down, and new districts grew up north and south of the “city between the bridges.” In the 18th century, fires destroyed large parts of the city, and stone buildings were constructed to replace the old wooden houses. Stockholm had by then become the cultural centre of Sweden; many of its literary societies and scientific academies date from this time.

A new period of development began with industrialization in the 19th century, and the introduction of municipally organized cleaning (1859) and sanitation (1861) contributed to a rapid increase in population. During this time redevelopment took place in the medieval city nucleus, buildings were reconstructed, boulevards, avenues, and parks were laid out, and many of the city’s present-day schools, museums, libraries, and hospitals were built. Many suburbs and satellite towns have subsequently developed.

The original nucleus of the city is the “city between the bridges”—Gamla Stan (Old Town), consisting of Stads Island, Helgeands Island, and Riddar Island. The buildings in this area are mainly from the 16th and 17th centuries. This well-preserved city nucleus, with the original network of streets and many of its buildings dating from the Middle Ages, is legally protected from change. Stads Island contains the Royal Palace; Storkyrkan, also called the Cathedral, or Church, of St. Nicolas; the German Church; the House of Lords; the government offices; the Stock Exchange; and a number of other notable buildings. Riddar Island is dominated by the Riddarholm Church. The House of Parliament and the National Bank are on Helgeands Island.

Stockholm is Sweden’s leading industrial area. Its major industries include metal and machine manufacturing, paper and printing, foodstuffs, and chemicals. It is also the country’s chief wholesale and retail centre and serves as the headquarters of many banks and insurance companies. Stockholm is also the second largest port in Sweden (Göteborg being the first). The national government’s many offices are a major employer in the city, as are various educational, scientific, and cultural institutions.

Stockholm is the chief educational centre in Sweden and is home to Stockholm University (1877), the Royal Institute of Technology (1827), and the Caroline Medical Institute. The city’s leading cultural institutions include the Royal Theatre (the opera), the Concert Association (Stockholm Philharmonic Orchestra), and the Royal Dramatic Theatre. In 1912 Stockholm hosted the Olympic Games.