The Empire's roots are within the history of the Old Republic, the Republic was formed and lasted for over 20,000 years, but corruption and decay developed as it aged. In its later years a Senator from the backwater planet of Naboo took advantage of the corruption to manipulate himself into power, he arranged a situation using both his political skills plus the Dark Side powers he had learnt. This situation would cause both sympathy for himself and a lot negative feeling towards the current leader of the Galactic Senate, Chancellor Valorum. This plan was completely successful, leading to Palpatines election as Chancellor.
Once in power Palpatine organised the military of the Republic into a more powerful fighting force, arranging the funding through the senate by citing piracy and threats from the Republics enemies such as the Mandalore. He also arranged for the destruction of the Jedi order, the Republics protectors since near its inception, using his latest Sith apprentice Darth Vader. Once his grip on power was unshakeable he disbanded the senate and declared himself Emperor, and the Republic was swept away becoming the Galactic Empire.
The Empire and its New Order maintained a grasp on almost every walk of life throughout known space, operating through both terror and subterfuge, entire worlds were enslaved such as Kashyyyk, the slave labour created through these racist and xenophobic policies being used to create ever larger weapons of war. One of the largest of these weapons was the Death Star, a moon sized battle station capable of destroying entire worlds, and the Death Star was only used twice before it was destroyed by the growing Rebellion.
The Emperor himself was killed aboard the second Death Star by his own apprentice, which was also destroyed by the Rebellion, leading to the decline of the Empire. After the Emperors death during the Battle of Endor, the Empire's morale collapsed and it found itself being forced away from many of the worlds that it had held. Many of the commanding officers who had once competed for the emperors favour, now just competed with each other causing the Empire to fragment, a process which only helped speed its collapse.
Four years after the Battle of Endor the Empire's decline had slowed, and the remnants of the Empire only controlled an area roughly equivalent to a third of the size that it had once been. It was at this time that the Sith Empire began their war against the New Republic, here the Empire found an ally, their policies and ideology were similar as were their goals, so soon the two found themselves forming a mighty alliance.
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