Gondar became the capital of the Ethiopian empire when emperor Fasiladas decided to move to it in 1636. Gondar remained the capital of the Ethiopian empire for the next two centuries. Gondar possessed a route to the exotic regions south of the Blue Nile and to the then northern and western trade routes, which led to Massawa and Sudan. Gondar had by 1630 become the catalyst of growth and production in Ethiopia. It was a great religious center and flourished immensely in the arts. (Pankhurst, R. 1998, 109)
Emperors of Gondar were great palace and church builders. The most famous of the Gondar palaces was built by emperor Fasiladas, known as Fasil Gemb. Ensuing rulers continued to build palaces, which still stand to the day. (Pankhurst, R. 1998, 109-110) Gondar rulers also built many churches in the city. The church of Debra Berhan Sellasie, a favorite tourist attraction, was built by emperor Iyasu I late in the 17th century. (Pankhurst, R. 1998, 116) Approximately a third of Gondar’s population was Muslim. Muslim merchants controlled most of the trade to and from Gondar. (Pankhurst, R. 1998, 117)
The influence of the Gondar monarchy began to weaken at the dawn of the 18th century. Military campaigns to crush provincial opponents became less effective and acquiring additional firearms more difficult. Within Gondar, many did not like the increasing number of Oromos in government. (Pankhurst, R. 1998, 126-7) In 1757, the city was occupied by Ras Mikael Sehul of Tigray. When he had taken the city, Emperor Iyoas was an infant. Ras Mikael himself had no intention of becoming emperor but he was the real leader of Gondar during the time he occupied it. In 1769, which marks the end of what is known as the Gondar Period in Ethiopian history, Ras Mikael had Iyoas killed and another noble appointed emperor. From there upon, the Ethiopian empire fell into a time of disunity. Even though emperors continued to be chosen and sat in Gondar, their power was virtually nonexistent. Each region of the country became ruled by local governors. (Pankhurst, R. 1998, 128-130).