When Felipe II chose Madrid as his capital in 1561, it was a small Castilian town of little real significance. In the following years, it was to grow into the nerve centre of a mighty empire.

According to tradition, it was the Moorish chieftain Muhammad ben Abd al Rahman who established a fortress above the Río Manzanares. Magerit, as it was called in Arabic, fell to Alfonso VI of Castile between 1083 and 1086. Narrow streets with houses and medieval churches began to grow up on the higher ground behind the old Arab alcázar (fortress). When this burned down in 1734, it became the site of the present Bourbon palace, the Palacio Real.

The population had scarcely reached 20,000 when Madrid was chosen as capital, but by the end of the 16th century it had more than trebled. The 16th-century city is known as the “Madrid de los Austrias”, after the reigning Habsburg dynasty. During this period royal monasteries were endowed and churches and private palaces were built. In the 17th century, the Plaza Mayor was added and the Puerta del Sol, the “Gate of the Sun”, became the spiritual and geographical heart not only of Madrid but all of Spain.