Ancient kingdoms flourished in southwestern Arabia (now Yemen), a crossroads of trade from the Orient and Africa to the Mediterranean. At the time of Christ, camel caravans carried as much as 3,000 tons of frankincense each year to Greece and Rome. Marib, capital of Saba (biblical Sheba), was the queen city of incense; nearby a huge dam irrigated thousands of hectares of farmland. Today a new dam and oil pump life into Marib. In Yemen's highlands volcanic soils yield cereal crops. Most coffee groves (Yemen invented the drink in the 11th century, and mocha is named for the Red Sea port, Al Mukha.) have been replaced by fields of kat, chewed as a stimulant.

Beginning in the 1500s the Turks periodically dominated the region's interior. After 1839 Britain controlled the port of Aden and surrounding coastal area; Aden boomed after the Suez Canal opened in 1869. In 1904 the Turks and the British established a boundary between their territories—known as North Yemen and South Yemen (Aden).

Following the 1918 collapse of the Ottoman Empire, tribal imams closed the doors of North Yemen. It reemerged in 1962, when army officers proclaimed the Yemen Arab Republic, sparking an eight-year civil war. South Yemen won independence from Britain in 1967 after two years of Marxist-guerrilla warfare; it became the People's Democratic Republic of Yemen in 1970. Ideological differences provoked conflicts between pro-Soviet South Yemen and pro-Western North Yemen in 1972 and 1979.

In May 1990 the two nations—spurred by reforms in Eastern Europe and the U.S.S.R. and drawn together by ancient cultural bonds—merged in an uneasy alliance that erupted into several weeks of civil war in 1994. Yemen's modest oil reserves provide most of the revenue, but it is the poorest country in the Middle East.