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Baku (or Baky pronounced ba-KEY, Баку or Bakı in Azeri) is the capital of Azerbaijan. It is located on the southern shore of the Apsheron peninsula and was founded 1,500 years ago. As of 1991 it had a population of 1,782,000.

The first written reference to Baku dates from 885, although archaeologists have found remains of a settlement predating by several centuries the birth of Christ. The city became important after an earthquake destroyed Shemakha and the of the 12th century and the Shirvanshah, Ahistan I, made Baku the new capital. There are a few theories about the origin of the name, the most widely known being that Baku comes from "bad kube", meaning "city of winds". The climate is sunny and arid, with gale-force winds that sweep through on occasion, caused by masses of polar air. Baku is located on the western shore of the Caspian Sea and is Azerbaijan's largest city, with wonderful beaches, spas and a striking setting on the salty Caspian Sea.

Today's Baku is really three cities rolled into one: the old town (icheri shekher), the boomtown and the Soviet-built town.

The centre of Baku is the old town, which is also a fortress. The walled city of Baku became in December 2000 the first location in Azerbaijan classified as World Heritage Site by UNESCO. Most of the walls and towers, strengthened after the Russian conquest in 1806, survive. This section is picturesque, with its maze of narrow alleys and ancient buildings. Wander the cobbled streets past the Palace of the Shirvanshahs, two caravansaraies (ancient inns), the 11th century Maiden's Tower (nice view of the harbour), the baths and the Djuma Mosque (it used to house the exquisite Carpet and Applied Arts Museum, but now is a Mosque again... and by the way the carpets are now at the former Lenin museum). The old town also has dozens of small mosques, often without any particular sign to distinguish them from the next building.

The boomtown, south of the old city, was built after massive oil exploitation began nearly a century ago and has interesting beaux-arts architecture. Fine arts, history and literature museums are located there, all housed in the mansions of pre-Revolutionary millionaires.

Modern Baku spreads out from the walls, its streets and buildings rising up hills that rim the Bay of Baku. Greater Baku is divided into 11 districts and 48 townships. Among these are townships on islands in the bay and one island town built on stilts in the Caspian Sea, 100 kilometres from Baku proper ('Oil Rocks').

The Martyrís Cemetery, formerly the Kirov park, is dedicated to the memory of those who lost their lives during the war with Armenia and also to the 137 people who were killed on January 20 & 19, 1990 when Soviet tanks and troops took to the streets of Baku. Photographs of victims featured on each tomb-stone are sobering and poignant. Now 20 January has become a national holiday of deep emotional meaning.

The basis of Baku's economy is petroleum. The existence of petroleum has been known since the 8th century. By the 15th century oil for lamps was obtained from surface wells. Commercial exploitation began in 1872, and by the beginning of the 20th century the Baku oil field was the largest in the world. Towards the end of the 20th century much of the land's petroleum had been exhausted, and drilling had extended into the sea. Baku ranks as one of the largest centres for the production of oil industry equipment. The World War II Battle of Stalingrad was fought to determine who would have control of the Baku oil fields. Fifty years before the battle, Baku produced half of the world's oil supply.

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