History of Waterdeep Waterdeep is on the site of an elven settlement called Aelinthaldaar , which was the capital of Illefarn at the time , and dates from around - 8500 DR . Early history . In - 1288 DR , Melairbode was created in the mountain beside and underneath Aelinthaldaar by the dwarven King Melair I , who began mining mithral there . As more and more " Melairkyn " arrived , the dwarves expanded their home to include areas nearer and nearer to the surface , which made the elves uneasy . In exchange for a large amount of mithral being mined by the Melairkyn dwarves , the elves created a magical effect on the plateau on which their city stood . This effect ensured that no matter what occurred below , the surface would remain unaffected and no collapse would occur there . Aelinthaldaar was razed in - 1100 DR after the elves inhabiting the city retreat ed to Evermeet . It was soon taken over by barbarian tribes who used it as a trade center from - 1088 DR , doing business with peoples further south . The deep natural harbor on the site made it a particularly good point to hold trademoots because large ships were able to load and unload goods . Eventually , tribes made the area their permanent home rather than revisiting for each trademoot . Conflict was common due to the lucrative trade opportunities , but the area was eventually secured by a tribe of people led by Nimoar , who named the town " Waterdeep , " or " Nimoar ' s Hold . " By 52 DR , a permanent farming community of Illusk ans had been established . In - 750 DR , the Netherese had moved to Melairbode uninvited , and made their home adjacent to the dwarves . The Sargauth Enclave was hewn from the rock by magic spells and then sealed . Over the years , a mantle was raised that served a similar purpose to a mythal . The disruption to the Weave in - 339 DR caused the collapse of most of the enclave , but what remains is now known as Skullport . The drow began to push the Melairkyn dwarves back from - 677 DR onwards , claiming more and more of Undermountain for themselves . They would eventually remove all the Melairkyn , but not until 211 DR . Halaster . In 168 DR , the wizard Halaster Blackcloak moved to the area and constructed Halaster ' s Hold a little to the northwest of the farming community . Between 171 DR and 308 DR he conducted Halaster ' s Hunts which brutally exterminated the drow and duergar from Undermountain , clearing the space for his own purposes . It was used until 307 DR , when the Seven , Halaster ' s apprentices , moved into the Undermountain and abandoned it . It fell into disrepair at this point . It was not until 493 DR that the drow finally abandoned Undermountain . Meanwhile , from 302 DR , the waters of the Lizard Marsh rose and forced Tavaray to be abandoned . The human settlements on the future site of Waterdeep became much more isolated , and the lack of prosperity and outside contact caused the populace to split back into tribes . Ulbaerag . In 482 DR , a warlord from Tethyr named Ulbaerag Bloodhand came to the area and united the tribes , claiming the settlement as " Bloodhand Hold . " It began exporting timber onto ships destined for areas further south that did not benefit from such large trees as could be found in the North . Ulbaerag actively rejected the opportunity to join the Kingdom of Phalorm , known as " the Realm of Three Crowns . " It was not until his son came to power that Bloodhand Hold finally joined the Kingdom . Its existence continued until 615 DR when the Horde of the Wastes overran it , destroying Uthtower and leading to the formation of the Mere of Dead Men . The Sword Mountains became infested with orc s but Bloodhand Hold survived . The collapse of the Realm of Three Crowns led to the formation of the Kingdom of Man , but Bloodhand Hold remained independent . Despite this , it was widely regarded as part of the Kingdom . After no heir existed to take the throne in 697 DR , the kingdom collapsed into civil war , but still Bloodhand Hold remained . Poor harvests in 734 DR caused the Hold ' s leader , Raulbaera Bloodhand , to establish an outlying settlement named Rowan Hold , which would later become Amphail . Nimoar . In 882 DR , a tribal leader known as Nimoar the Reaver led his tribe in search of a new place to live after the fall of the elven kingdoms . Nimoar and his tribe came across Bloodhand Hold and had no trouble in seizing it for themselves , renaming it " Nimoar ' s Hold . " It suffered a large pirate attack in 887 DR but held strong , and then two years later , in 889 DR , the Blood Elk tribe set the settlement alight , but again it survived , and was rebuilt before the end of the year . Trollwars . Due to massive orc uprisings and population growth in the north , troll s were forced out of their homes and pushed south , into the area now known as the Evermoors , and into conflict with the human s . The first conflict occurred in 932 DR but was ended before the year ' s end , with the humans purging the moors area of trolls . In 936 DR the Trollwars were punctuated by the Orcfastings War , where the orc armies of Uruth Ukrypt attacked Nimoar ' s Hold . The second conflict erupted in 940 DR when the trolls began making continual raids on the humans . It lasted until 952 DR , when it was ended decisively by the magic of the 32 - year - old mage Ahghairon , but six of the War Lords were killed in the combat . A knight of Tyr named Samular Caradoon was recognised as a hero in the second Trollwar , and went on to form the Holy Order of Samular . Following the conflict , a walled keep was constructed on the slopes of the mountain , and the walls continued to expand as more and more people from the surrounding area came to it for protection . At this time , the " Free City of Waterdeep " was ruled by War Lords . A temple and monastery to Lathander was constructed outside the city , and this would later become the Spires of the Morning . Ahghairon . Warlord Raurlor became the Warlord of Waterdeep , and aimed to use the city ' s wealth to create a vast empire in Northwest Faerûn . Ahghairon voiced strong opposition to this in 1032 DR , and Raurlor ordered that he was to be arrested . When Ahghairon used his magic to prevent his own arrest , Raurlor struck out at him , but Ahghairon turned Raurlor ' s sword into a snake , which bit him , poisoning and killing him . Ahghairon declared himself the first Lord of Waterdeep , and created the current system of government whereby all Lords but one ( initially himself ) have hidden identities . Under Ahghairon , Waterdeep secured the areas to the north for the humans and built new roads to interconnect them , while continuing to grow to five times its size , becoming more and more prosperous . The city developed the nickname " the Crown of the North . " Ahghairon restructured the army and navy that Raurlor had built up into the city watch and the city guard ( for both navy and army ) . As crime and deceit began to develop in Waterdeep , Ahghairon ordered the creation of guilds , a trend from cities in the south , to prevent the further spread of problems . It was under Ahghairon that the city began to use its system of wards , which was first introduced in 1035 DR . By 1064 DR , the city had reached 50 , 000 inhabitants . In 1037 DR , creatures from another plane appeared in Waterdeep after emerging from the Undermountain . Ahghairon and one of the masked Lords named Kherris turned them back . 1101 DR saw further expansion of the city walls , to include the Spires of the Morning , the temple to Lathandar that had previously been outside the city . In 1150 DR the city was hit by the plague that was travelling the Sword Coast . This was also the year Khelben " Blackstaff " Arunsun ( then known as " Khelben the Elder " ) first arrived in Waterdeep . Maulagrym attacked Khelben ' s tower in 1179 DR , but they were defeated by Khelben , Elminster , Hamiklar Wands and other Waterdhavian mages . The city was besieged in 1235 DR by the largest orc horde ever recorded . The siege lasted for nine months , but it was broken when Ahghairon used griffon s to fly supplies of food and aid into of the city . The only incident of betrayal amongst the Lords of Waterdeep occurred in 1246 DR when Kerrigan , a masked Lord , began slaying the other Lords . He murdered three before Ahghairon confronted him in a battle of magic that ended in the Southern Ward , where Kerrigan was killed . Owing to a lack of space , the individual graves were replaced with tombs , creating the City of the Dead in 1250 DR . By 1252 DR , problems with undead from the area led to the raising of walls to separate it from the rest of the city . In 1255 DR , the Shadow Thieves begin operating in Waterdeep . Eventually , even Ahghairon ' s magic could not keep him alive , and he died in 1256 DR . He was buried in his own tower , which was sealed off and protected by magic . It is believed that his resting place has remained undisturbed ever since . Guildmasters . Turmoil followed Ahghairon ' s death while the merchants of Waterdeep bickered over who would assume power . Nothing was heard from the masked Lords of Waterdeep , either because they could not communicate without revealing their identities now that Ahghairon was gone , or because their identities had already been compromised and they had been murdered . In fact , the only survivors amongst the masked Lords were the woodworker Baeron and the apprentice wizard Shilarn . After two months , power was taken by the Guildmasters who had been appointed by Ahghairon . The following six years were termed " the Guildwars " because of the violence and murder that occurred , often between private armies , ultimately leaving only two surviving Guildmasters . The surviving guildmasters , gemcutter Ehlemm Zoar and shipwright Lhorar Gildeggh eventually tired of bloodshed and agreed to rule together , as " Lords Magister , " in 1262 DR . They did not agree on much else , and continued to argue , leading to continuing tensions within the city . Eleven years later , in 1273 DR , the Lords Magister were visited by Baeron and Shilarn who had concealed themselves underneath cloaks . Shilarn ordered the Lords Magister to leave the city . When they refused , she struck them down with magic , killing them both , and she and Baeron , the two remaining former masked Lords , took power . Baeron . The Gildeggh and Zoar houses were banned from Waterdeep . The other noble houses were given the choice either to leave the city , or to obey the new rulers . Baeron publicly revealed his identity , assuming the role of the Open Lord . The original form of government , whereby Waterdeep is led by one Open Lord and a number of Masked Lords , was restored . In order to further prevent the discovery of the identities of the Masked Lords , a group of Magisters named " the Black Robes " were instated as judges and dispensers of the law . In Uktar of 1273 DR , the Shadow Thieves were outlawed in Waterdeep . 1276 DR saw the birth of Lhestyn ( later known as " the Masked Lady " ) , daughter to Baeron and Shilarn . The North Ward and the Sea Ward were introduced in this year , and the Lords of Waterdeep increased their number to sixteen . In 1298 DR , Lhestyn infiltrated the Shadow Thieves and exposed them in Waterdeep . They were killed or chased out of the city . Baeron died of a fever in 1308 DR , and his wife Shilarn threw herself onto his funeral pyre . Lhestyn and Piergeiron . Lhestyn took over as Open Lord after Baeron , but only until her death in 1314 DR . She was succeeded by Piergeiron the Paladinson who ruled as Open Lord relatively peacefully . In the early winter of 1345 DR , during the Night of the Temple Fires , religious disorder between the churches of Lathander , Selûne , Shar and Tempus caused the Spires of the Morning and the House of Heroes to be burned to the ground . Both were rebuilt within a year . During the Time of Troubles in 1358 DR , Myrkul attacked Waterdeep causing huge fires and widespread destruction , mostly in the Castle , Dock and Southern Wards . Many inhabitants of the city hear the voice of Ao , and Cyric and Midnight ascend as new gods . The summer of 1364 DR brought droughts and increased monster activity to the city . Shieldmeet at the Field of Triumph is disrupted by a green dragon . The next year , in 1365 DR , limited trade is established with Zakhara and Maztica , but the sea journeys are highly dangerous . Present day . In present - day Waterdeep ( circa 1374 DR ) , the only remnants of the long - razed Aelinthaldaar are crypts beneath the Pantheon Temple of the Seldarine , and the magic that prevents the plateau from collapsing .