The threat posed by the Moors and their Spanish neighbors shaped much of Portugal's history, from the defensive alliances it forged with England to the international ventures it decided to seek. To some extent, Portugal would never overcome that encirclement anxiety: water surrounding it coupled with an expansionist Spain where the frontier was dry. In 2004, Portugal's prime minister declared that the nation must overcome its inferiority complex regarding Spain. When Brazil gained its independence from Portugal, the latter diverted its interests to its African colonies. Britain then ended 500 years of protection for Portugal under the Treaty of Windsor. This chapter looks at the history of Portugal, starting with how it became a nation and then proceeding with its exploration and expansion. It also discusses the rule of King Sebastian and Messianic Judaism, the demise of the monarchy, and Portugal's transition to a republican form of government in 1911.