Despite its relatively small size, Karakorum was one of the most important cities in the history of the Silk Road. Although founded by Genghis Khan in 1220, Karakorum's development as capital of the Mongol Empire occurred in the 1230s under his son Ögedei. The Mongols had a profound impact on the history of trade across Central Asia, as their vast empire connected east and west, and trade and exchange were facilitated by the Pax Mongolica, enforcing, as far as possible, peace and a degree of stability across the vast territories under Mongol rule.
Karakorum is strategically located on the most important east-west route across Mongolia, not far from the Orkhon River. This river valley was considered a sacred homeland by steppe peoples who traditionally placed their capitals there, and Turkish, Chinese, Uighur and Sogdian inscriptions from the region, dating from the 8th and 9th centuries AD, suggest that the area had become a flourishing centre not only of local agriculture but also of the cultures of the peoples who lived around the steppe lands.
The Mongol choice of the location for Karakorum was no accident: ecology, political considerations, steppe tradition and local beliefs all came together there. It is undoubtable that the Mongols were aware of the earlier history of the region and built on its legacy.
Ironically, there are few surface traces of the Mongol capital in today’s city. The town wall enclosed a somewhat irregular rectangle measuring approximately 1.5 by 2.5 kilometres. The walls were sufficient for controlling access to the town but would not have protected it against a major attack. Important economic activities, merchant residences and religious buildings were located within the walls. Given what we know about the settlement and movement patterns of the Mongols, it is clear that at the times when the Khan's court was present, the population of the town would have grown substantially by the temporary residence of Mongols in their gers (yurts) in the adjoining territory.
The Franciscan William of Rubruck in 1253-1255 was the first European to provide an eyewitness description of Karakorum. He was a careful observer, and tells us that:
“It contains two quarters: one for the Saracens, where the markets are and where many traders gather due to the constant proximity of the camp and to the great number of envoys; the other is the quarter of the Cataians, who are all craftsmen. Set apart from these quarters lie large palaces belonging to the court secretaries. There are twelve idol temples belonging to the different peoples, two mosques where the religion of Mahomet is proclaimed, and one Christian church at the far end of the town. The town is enclosed by a mud wall and has four gates.”
The archaeological evidence provides further details to this picture of the town's economic life, with particularly rich material continuing to be found in the Chinese commercial section of the centre of the city. Karakorum was a centre of metallurgy, and iron cauldrons, axle rings for carts, abundant quantities of arrowheads, and various decorative metal objects have been uncovered. Local industry produced glass beads for jewellery and other decorative purposes; their forms are of a type that was widespread across all of the Mongol Empire. Spindle weights tell us that yarn was being produced - presumably from the wool of the Mongols' own flocks. We know that rich silk fabrics were highly valued by the Mongol elite, and some fragments of imported Chinese silk have been found. While there was limited production of grain in the surrounding region, it seems likely that the demand for grain required much of it to be imported from China. The archaeologists have discovered at least one small millstone.
Of particular interest is the production and importation of ceramics. Recent excavations uncovered ceramic kilns, which produced such objects as roof tiles and finials for the Chinese-style buildings, water pipes, sculptures and a variety of table ware. The evidence suggests that the technology came from China. At the same time, the demand of the elite for high quality ceramic wares was met by imports, including good Chinese porcelain. When the famous blue-and-white porcelains began to be produced in the first half of the 14th century, they almost immediately found a market in Karakorum.
Evidence concerning commerce includes coinage. For all the fact that the written sources emphasize the significant role of Muslim merchants connecting Karakorum with Central Asia, most of the coins which have been discovered are of Chinese origin and range in date from a few T'ang Dynasty examples up to the Yuan (Mongol) coinage. However, earliest documentary evidence which has survived from Karakorum is a coin with an Islamic inscription minted there in 1237-8. Excavations have also yielded a great many metal weights.
The population of the city also contained a microcosm of the religious diversity of the Mongol empire. Shamanism, the Mongolian indigenous religion, was practiced, as well as Islam brought by Muslim traders in earlier centuries. Buddhism was very popular in the city at this time too, as was Nestorian Christianity.
By the time Marco Polo reached China in the early 1270s, the Qubilai Khan had made Beijing the Empire's capital, replacing Karakorum. Yet throughout much of the 14th century it retained a symbolic importance as the city 'founded' by the charismatic founder of the Empire, Genghis Khan. Today, Karakorum is the location of one of the important annual Naadam festivals, celebrating Mongolian traditional sports and culture.