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No doubt the history of Ithaca is strongly connected to the myth of Odysseus, although the palace of Odysseus has not been discovered yet. Ithaca has been inhabited since the prehistoric times, like the other islands of the Ionians. Proofs of early life in ancient Ithaca provide the shards that were found at Pilikata, with an inscription in Linear A, dating back to prehistoric times. All seven Ionian Islands shared the same lack, as they were constantly invaded mostly due to their location on the trade. The island of Ithaca met its greatest glory around 1000 BC when the kingdom of Ithaca was constituted by all the Ionian Islands and a part of the coast of Acarnania, in the mainland of Greece. The first ancient occupiers to rule the Ionians were the Mycenaeans, who have left significant traces. It is believed that the ancient capital of the island was Alalcomenae.
During the Classical period, Ithaca and all the Ionians were home to several independent city-states, which later joined one of the great leagues led by Corinth, Athens, and Sparta. Those league divisions triggered the Peloponnesian War, in 431 BC. All the Ionian Islands were threatened by Macedonian invasions during Hellenistic times. The Romans finally managed to take control of the region in 187 BC. During Roman times, Ithaca was part of the Eparchy of Illyria. When Emperor Constantine divided the Roman Empire during the 4th century AD, Ithaca became part of the Byzantine Empire, until it was occupied by the Normans in 1185 and the Angevins in the 13th century.
In the 12th century, Ithaca was ceded to the Orsini family and later to the Tocchi Family. With the help of the Tocchi family, the island of Ithaca developed into an independent state with a fully equipped army and naval fleet. This Venetians showed their power until 1479 through trade and some splendid constructions, whose ruins can still be seen in the area.
Eventually, the Venetians left Ithaca, fearing the great power of the Turks who wanted to annex the Ionian Islands. The same year, Turks took the command of Ithaca by force, killing its inhabitants and destroying the villages. Most of the inhabitants of the island left their homeland fearing the Turkish occupiers. Those who stayed found shelter in the mountains. During the following five years, the Turks and the Venetians kept arguing about the control of the Ionians. Finally, the islands were given to the Turkish Empire. Nevertheless, the Venetians managed to strengthened and organize their fleet and started a war against the Turks in 1499. Finally, the Venetians regained the Ionians in 1500 AD and a treaty was signed by the Turks, mentioning that Ithaca, Kefalonia, and Zakynthos belonged to the Venetians, while Leukada remained under Turkish rule.
During the Venetian occupation, the population of Ithaca, which had decreased from the frequent pirate raids and the Turkish attacks, started growing and developing again, and Vathy became the capital of the island. The cultivation, especially of raisin, ameliorated the economic situation of the inhabitants of Ithaca, and ships were built to confront the pirates, leading to the development and the power of the island's shipping industry and the improvement of the society. The island was considered as semi-independent, ruled with a liberal system of democracy, without any social classes. The Ionians remained under the control of Venice until the defeat of Venice by Napoleon in 1797, when they came under the rule of the French Democrats. Ithaca became the honorary capital of Kefalonia, Lefkada and a part of the Greek mainland. The French were succeeded by Russia and Turkey in 1798, which were their allies, and Corfu became the capital of the Ionian States.
In 1807, after an agreement with Turkey, the Ionian Islands returned under the French rule, who prepared to face the powerful English fleet by fortifying the town and capital of Vathy. In 1809, the Ionian islands came under English rule and the Ionian State was formed, governed by a Constitution imposed in 1817 where Ithaca was represented by one member (in the Ionian Senate). During the years of the Greek Revolution against the Turks, Ithaca offered hospitality and medical care to the revolutionaries and participated in the War of Independence of 1821, participating in the Hellenic Revolutionary fleet.
Productivity, trade, private and communal education developed and increased the leaving standard on Ithaca. In the 19th century, the island raised many important personalities for Greek history. In 1864, because of the international situation in Europe and of a series of negotiations, Ithaca was finally liberated and, with the other Ionian Islands, became a part of the New Greek State. During the Second World War, the island suffered from the Italian and the German occupation.
In August of 1953, a series of strong earthquakes brought great damages to the Ionian Islands, destroying the majority of the buildings. The rebuilding started immediately after the earthquakes, with the financial help of Europe and the United States. In the 1960s, tourism started to reach the Ionian Islands and Ithaca. The island prepared itself to welcome the tourists by building a new road, increasing the ferry services and improving the tourist facilities of the island. Today, tourism and fishing are the main sources of income for the inhabitants of Ithaca.