Malaysia, a member of the Commonwealth, represents the political marriage of territories that were formerly under British rule. When it was established on Sept. 16, 1963, Malaysia comprised the territories of Malaya (now Peninsular Malaysia), the island of Singapore, and the colonies of Sarawak and Sabah in northern Borneo. In August 1965 Singapore seceded from the federation and became an independent republic.

The long, narrow, and rugged Malay Peninsula extends to the south and southwest from Myanmar and Thailand. The Malaysian portion of it is about 500 miles (800 km) long and—at its broadest east-west axis—about 200 miles (320 km) wide. About half of Peninsular Malaysia is covered by granite and other igneous rocks, one-third is covered by stratified rocks older than the granite, and the remainder is covered by alluvium. At least half the land area lies more than 500 feet (150 metres) above sea level.

Peninsular Malaysia is dominated by its mountainous core, which consists of a number of roughly parallel mountain ranges aligned north-south. The most prominent of these is the Main Range, which is about 300 miles (480 km) long and has peaks exceeding 7,000 feet (2,100 metres). karst landscapes—limestone hills with characteristically steep whitish gray sides, stunted vegetation, caves created by the dissolving action of water, and subterranean passages—are distinctive landmarks in central and northern Peninsular Malaysia. Bordering the mountainous core are the coastal lowlands, 10 to 50 miles (15 to 80 km) wide along the west coast of the peninsula but narrower and discontinuous along the east coast.

East Malaysia is an elongated strip of land approximately 700 miles (1,125 km) long with a maximum width of about 170 miles (275 km). The coastline of 1,400 miles (2,250 km) is paralleled inland by a 900-mile (l,450-km) boundary with Kalimantan. For most of its length, the relief consists of three topographic features. The first is the flat coastal plain. In Sarawak, where the coastline is regular, the plain averages 20 to 40 miles (30 to 60 km) in width, while in Sabah, where the coastline is rugged and deeply indented, it is only 10 to 20 miles (15 to 30 km) wide. Inland from the coastal plain is the second topographic feature, the hill-and-valley region. Elevations there generally are less than 1,000 feet (300 metres), but isolated groups of hills reach heights of 2,500 feet (750 metres) or more. The terrain in this region is usually irregular, with steep-sided hills and narrow valleys. The third topographic feature is the mountainous backbone that forms the divide between East Malaysia and Kalimantan. This region, which is higher and nearer to the coast in Sabah than in Sarawak, is composed of an eroded and ill-defined complex of plateaus, ravines, gorges, and mountain ranges. Most of the summits of the ranges are between 4,000 and 7,000 feet (1,200 and 2,100 metres). Mount Kinabalu (Kinabalu, Mount) towers above this mountain complex; at 13,455 feet (4,101 metres), it is the highest peak in Malaysia and in the Southeast Asian archipelago as a whole.

Peninsular Malaysia is drained by an intricate system of rivers and streams. The longest river—the Pahang (Pahang River)—is only 270 miles (434 km) long. Streams flow year-round because of the constant rains, but the volume of water transported fluctuates with the localized and torrential nature of the rainfall. Prolonged rains often cause floods, especially in areas where the natural regimes of the rivers have been disrupted by uncontrolled mining or agricultural activities.

As in Peninsular Malaysia, the drainage pattern of East Malaysia is set by the interior highlands, which also form the watershed between Malaysia and Indonesia. The rivers, also perennial because of the year-round rainfall, form a dense network covering the entire region. The longest river in Sarawak, the Rajang (Rajang River), is about 350 miles (563 km) long and is navigable by shallow-draft boats for about 150 miles (240 km) from its mouth; its counterpart in Sabah, the Kinabatangan (Kinabatangan River), is of comparable length but is navigable only for about 120 miles (190 km) from its mouth. The rivers provide a means of communication between the coast and the interior, and historically, most settlement has taken place along the rivers.

The soils of both portions of Malaysia have been exposed for a long period of time to intense tropical weathering, with the result that most of their plant nutrients have been leached out. Soils typically are strongly acidic and coarse-textured and have low amounts of organic matter. Any organic matter is rapidly oxidized when exposed to weathering, and the soils consequently become even poorer. Soil erosion is always a danger on sloping ground, where such preventive measures as building contour embankments or planting protective cover crops are required.

Only a small proportion of the soils of Peninsular Malaysia is fertile, necessitating regular application of fertilizer to sustain crop yields. Generally, soil conditions in Sarawak and Sabah do not differ greatly from those on the peninsula. Of these three regions, only Sabah has appreciable areas of fertile soils. These are found in the southeastern coastal areas, where the parent substance from which the soil is formed is composed of chemically basic volcanic materials.

Both peninsular and insular Malaysia lie in the same tropical latitudes and are affected by similar airstreams. They have high temperatures and humidities, heavy rainfall, and a climatic year patterned around the northeast and southwest monsoons (monsoon). The four seasons of the climatic year are the northeast monsoon (from November or December until March), the first intermonsoonal period (March to April or May), the southwest monsoon (May or June to September or early October), and the second intermonsoonal period (October to November). The onset and retreat of the two monsoons are not sharply defined.

Although Malaysia has an equatorial climate, the narrowness and topographic configuration of each portion—central mountainous cores with flat, flanking coastal plains—facilitate the inland penetration of maritime climatic influences. The monsoons further modify the climate. The northeast monsoon brings heavy rain and rough seas to the exposed coasts of southwestern Sarawak and northern and northeastern Sabah, and it sometimes causes flooding in the eastern part of the peninsula. The southwest monsoon affects mainly the southwestern coastal belt of Sabah, where flooding is common. Neither peninsular nor insular Malaysia is in the tropical cyclone (typhoon) belt, but their coasts occasionally are subject to the heavy rainstorms associated with squalls (squall).

Temperatures are uniformly high throughout the year. On the peninsula, they average about 80 °F (27 °C) in most lowland areas. In coastal areas in East Malaysia, minimum temperatures range from the low to mid-70s F (about 23 °C), and maximum temperatures hover around 90 °F (32 °C); temperatures are lower in the interior highland regions. The mean annual rainfall on the peninsula is approximately 100 inches (2,540 mm); the driest location, Kuala Kelawang (in the district of Jelebu), near Kuala Lumpur, receives about 65 inches (1,650 mm) of rain per year, while the wettest, Maxwell's Hill, northwest of Ipoh, receives some 200 inches (5,000 mm) annually. Mean annual precipitation in Sabah varies from about 80 to 140 inches (2,030 to 3,560 mm), while most parts of Sarawak receive 120 inches (3,050 mm) or more per year.

The characteristic vegetation of Malaysia is dense, evergreen rainforest. Rainforest still covers more than two-fifths of the peninsula and some two-thirds of Sarawak and Sabah; another fraction of the country is under swamp forest. Soil type, location, and elevation produce distinctive vegetation zones: tidal swamp forest on the coast, freshwater- and peat-swamp forest on the ill-drained parts of the coastal plains, lowland rainforest on the well-drained parts of the coastal plains and foothills up to an elevation of about 2,000 feet (600 metres), and submontane and montane forest (also called cloud forest) in higher areas. The highly leached and sandy soils of parts of central Sarawak and the coast support an open, heathlike forest commonly called kerangas forest.

Animal life in East Malaysia is even more varied than it is on the peninsula. In addition to the peninsular species, East Malaysia is also the home of fast-disappearing orangutans (orangutan) and rhinoceroses, sun bears (sun bear) (also called honey bears), and unique proboscis monkeys (proboscis monkey)—a reddish tree-dwelling species. There also are vast numbers of cave swifts, whose nests are regularly collected and sold as the main ingredient of Chinese bird's nest soup.

The people of Malaysia are unevenly distributed between Peninsular (Peninsular Malaysia) and East Malaysia, with the vast majority living in Peninsular Malaysia. The population shows great ethnic, linguistic, cultural, and religious diversity. Within this diversity, a significant distinction is made for administrative purposes between indigenous peoples (including Malays), collectively called bumiputra, and immigrant populations (primarily Chinese and South Asians), called non-bumiputra.

The Malay Peninsula and the northern coast of Borneo, both situated at the nexus of one of the major maritime trade routes of the world, have long been the meeting place of peoples from other parts of Asia. As a result, the population of Malaysia, like that of Southeast Asia as a whole, shows great ethnographic complexity. Helping to unite this diversity of peoples is the national language, a standardized form of Malay (Malay language), officially called Bahasa Malaysia (formerly Bahasa Melayu). It is spoken to some degree by most communities, and it is the main medium of instruction in public primary and secondary schools.

In general, peninsular Malaysians can be divided into four groups. In the order of their appearance in the region, these include the various Orang Asli (“Original People”) aboriginal peoples, the Malays (Malay), the Chinese, and the South Asians. In addition, there are small numbers of Europeans, Americans, Eurasians, Arabs, and Thai. The Orang Asli constitute the smallest group and can be classified ethnically into the Jakun, who speak a dialect of Malay (Malay language), and the Semang and Senoi, who speak languages of the Mon-Khmer language (Mon-Khmer languages) family.

The Chinese, who make up about one-fourth of Malaysia's population, originally migrated from southeastern china. They are linguistically more diverse than the Malays, speaking several different Chinese languages; in Peninsular Malaysia, Hokkien and Hainanese (Southern Min languages), Cantonese (Cantonese language), and Hakka (Hakka language) are the most prominent. Because these languages are not mutually intelligible, it is not uncommon for two Chinese to converse in a lingua franca such as Mandarin (Mandarin language) Chinese, English, or Malay. The community that is colloquially called Baba Chinese includes those Malaysians of mixed Chinese and Malay ancestry who speak a Malay patois but otherwise remain Chinese in customs, manners, and habit.

The peoples from South Asia—Indians, Pakistanis, and Sri Lankans—constitute a small but significant portion of the Malaysian population. Linguistically, they can be subdivided into speakers of Dravidian languages (Tamil (Tamil language), Telugu (Telugu language), Malayalam (Malayalam language), and others) and speakers of Indo-European languages (Punjabi (Punjābī language), Bengali (Bengali language), Pashto (Pashto language), and Sinhalese (Sinhalese language)). The Tamil speakers are the largest group.

The population of East Malaysia is ethnographically even more complex than that of Peninsular Malaysia. The government, tending to oversimplify the situation in Sarawak and Sabah, officially recognizes only some of the dozens of ethnolinguistic groups in those two states.

The main ethnic groups in Sarawak are the Iban (Sea Dayak), an indigenous group accounting for more than one-fourth of the state's population, followed by the Chinese, Malays, Bidayuh (Land Dayak), and Melanau. An array of other peoples, many of whom are designated collectively as Orang Ulu (“Upriver People”), constitute an important minority. The various indigenous peoples of Sarawak speak distinct Austronesian languages.

The Iban, formidable warriors of the 19th and early 20th centuries, trace their origins to the Kapuas River region in what is now northern West Kalimantan (Kalimantan Barat), Indonesia. The traditional Iban territory in Sarawak spans the hilly southwestern interior of the state. Iban who still live in rural regions usually cultivate rice through shifting agriculture, whereby fields are cleared, planted for a short period, and then abandoned for several years to allow the soil to regenerate. The Iban language is related to, but distinct from, Malay.

The Chinese of Sarawak generally live in the region between the coast and the uplands. In the rural areas, they usually grow cash crops in smallholdings. They speak mostly Hakka and Fuzhou (a Northern Min language (Min languages)) rather than Cantonese, Hokkien, and Hainanese, which are predominant among peninsular Chinese.

Few Malays of Sarawak are of peninsular origin; rather, most are the descendants of various indigenous peoples who since the mid-15th century have converted to Islam. Despite their diverse ancestries, the Malays of Sarawak and those of Peninsular Malaysia share many cultural characteristics, cultivated largely through the practice of a common religion. Sarawak Malays, however, speak dialects of the Malay language that are distinct from those spoken by their peninsular counterparts.

Like the Iban, the Bidayuh originally came from regions that now lie in northwestern Indonesian Borneo; in Sarawak the Bidayuh homeland is in the far western portion of the state. Most rural Bidayuh practice shifting rice cultivation. Although they have for centuries lived in close proximity to the Iban, the Bidayuh speak a separate language, with a number of different but related dialects that to some extent are mutually intelligible.

Sarawak's south-central coastal wetlands between the city of Bintulu and the Rajang River are the traditional territory of the Melanau. The Melanau are especially known for their production of starch from the sago palms that surround their villages. Culturally and linguistically linked to certain inland peoples to the southeast, the Melanau purportedly moved to the coast from the interior centuries ago. The dialects of the northeastern portion of the Melanau region differ so starkly from those of the southwest that some local Melanau speakers hear the dialects as separate languages.

Smaller indigenous groups, such as the Orang Ulu—an ethnic category embracing the Kenyah, Kayan, Kelabit, Bisaya (Bisayah), Penan, and others—also contribute much to Sarawak's ethnic and cultural character. The Kenyah, Kayan, and Kelabit generally trace their origins to the southern mountains on the border with East Kalimantan (Kalimantan Timur), Indonesia. Other Orang Ulu groups stem from lower-lying inland areas, primarily in Sarawak's northeastern region. Many distinct languages, some with multiple dialects, are spoken by Sarawak's indigenous peoples, often within just a few miles of each other.

Sabah also has a kaleidoscopic mixture of peoples. The largest groups, who in roughly equal numbers account for about half of the population, are the Kadazan (also called Dusun or Kadazan Dusun), the Bajau, and the Malays. Indigenous peoples, such as the Murut, Kedayan, Orang Sungei, and Bisaya, together constitute a significant portion of the state's inhabitants as well. Chinese, Europeans, Eurasians, Indonesians, Filipinos, and South Asians make up the remainder.

Until the late 20th century, the Kadazan were generally called Dusun, an ethnic term that, like the term Orang Ulu in Sarawak, applied to a number of related peoples. Since that time, however, Kadazan has become the more common term in colloquial usage. For administrative purposes, the government has used both names together, sometimes merging them into the term Kadazandusun (especially when referring to language). The various Kadazan peoples speak related dialects that most other Kadazan can understand.

Sabah's Chinese population is predominantly Hakka-speaking, but there are also many speakers of Cantonese, Hokkien, Chaozhou (Chaoshan), and Hainanese. The Bajau are a diverse community split into two main groups: sedentary agriculturists of the north coast and seafaring people of the east coast. Their languages, which are related to those of the southern Philippines, are not all mutually intelligible. The Murut of Sabah inhabit an area from the western lowland south through the hills into East Kalimantan, Indonesia. The lowland-dwelling Murut generally call themselves Timugon, while their upland counterparts are known as Tagal. Both communities engage in shifting agriculture. Murut languages are, for the most part, mutually intelligible.

Among the non-Malay indigenous peoples, many of the peninsula's Orang Asli have adopted Islam, but some communities maintain local religions. In Sarawak, the Iban, the Bidayuh, and most others tend to follow Anglicanism, various other Protestant Christian denominations, or Roman Catholicism. The Melanau, however, are primarily Muslim, with a Christian minority. Local religions have been maintained by only small segments of Sarawak's population. Local religions also are practiced by a minority of the non-Malay indigenous populations of Sabah. The Kadazan and Murut are primarily Christian, although there is also a significant Muslim community. Most Bajau follow Islam.

About one-third of Malaysia's population is rural. The basic administrative unit in both East and Peninsular Malaysia is the kampung (village, or community of houses).

In Peninsular Malaysia rural houses usually are built of wood and raised on stilts. Some still feature a thatched roof, called an atap, woven from the leaves of the nipa palm (Nypa fruticans; a species also used for basketry). In the 21st century, however, roofs of corrugated metal are much more common. Each house is typically surrounded by a grove of coconut palms and scattered banana, papaya, and other fruit trees. The four main types of rural Malay settlement—fishing villages, paddy or wet-rice (irrigated) villages, cash-crop villages, and mixed-crop villages—all conform to this basic structural pattern on the peninsula.

Most other villages in Peninsular Malaysia are associated with peoples who have settled in the country since the early 19th century. The first of these immigrant settlements were mining camps, established primarily by Chinese around tin fields in the west. Some of the camps have since grown into large towns, but others—especially in the Kinta River valley—have remained small. In the mid-1800s the British introduced the plantation system of agriculture, and the subsequent cultivation of rubber (Hevea brasiliensis) and oil palm trees (Elaeis guineensis) changed the face of rural Peninsular Malaysia. Added to the landscape was the plantation (estate) settlement, typically a group of buildings consisting of the processing factory and storehouse, the labourers' quarters, and the manager's house. Many of the workers on these plantations were from southern India, brought to Malaysia by the British colonial government, especially during the rubber boom of the early 20th century; plantation housing has continued to be occupied largely by Indian Malaysians.

New Villages represent a type of settlement that is unique to Peninsular Malaysia. They were originally established by the government as roadside relocation settlements for rural Chinese during the Malayan Emergency (1948–60), a period of intense conflict between the British administration and a (largely Chinese) communist guerrilla insurgency that arose after World War II. With the end of the emergency in 1960, some of the New Villages were abandoned, but most of them became permanent settlements.

A more recent and significant government program has involved the resettlement of poor Malays into forest areas, which are cleared and planted in rubber trees and oil palms. Since the mid-20th century, hundreds of thousands of families have been resettled.

The Malays and the Melanau of East Malaysia share many characteristics with their rural counterparts on the peninsula. They tend to be riverine and coastal peoples, with an economy based on agriculture and fishing. Many live in villages in the midst of coconut palms, mangroves, or other swamp trees. Their houses generally are built on stilts. The rural Chinese, by contrast, typically live in homesteads strung along both sides of the roads. Their houses are commonly built at ground level and thus are easily distinguishable from the stilt-raised dwellings of the indigenous peoples.

Urbanization in Peninsular Malaysia has been especially rapid since the 1970s. Planned satellite towns, such as Petaling Jaya and Shah Alam (made the state capital of Selangor in 1978), outside Kuala Lumpur, have emerged as cities, while new settlements have sprouted alongside them. Most of the towns of Peninsular Malaysia, however, are unplanned, having grown up around small nuclei. Urban land use generally is mixed, and buildings are put to multiple uses. Many streets that were built for a more leisurely era are now too narrow and often congested. In the larger cities, such as Kuala Lumpur, Ipoh, and George Town (on the island of Penang), distinct central business districts have arisen. These areas are densely populated and characterized by heavy street traffic, high land values, and a concentration of shopping, banking, insurance, entertainment, and other facilities.

Urbanization in Sarawak and Sabah also has proceeded at a quick pace, indeed surpassing that of some of the states of Peninsular Malaysia by the early 21st century. The largest towns are Kuching, Miri, and Sibu in Sarawak and Kota Kinabalu, Sandakan, and Tawau in Sabah. The large towns invariably are located on coastal or riverine sites. The layout and appearance of these towns are markedly similar: a wharf area, rows of Chinese shop-houses in the central business districts, more-substantial buildings in the governmental administrative area, and one or more villages of timber and thatch (or corrugated metal) built on the riverbanks.

Before World War II, there was a free flow of people to and from both Peninsular and East Malaysia, and the rate of population growth was greatly influenced by a net surplus from immigration. However, a series of laws passed since 1945, particularly after the political separation of Singapore in 1963, restricted the entry of immigrants from all countries. Thus, legal immigration has long ceased to be a major cause of population growth.

The major area of population concentration in Peninsular Malaysia is an axis of economic development on the west side of the peninsula. Smaller concentrations are found in the Kelantan and Terengganu river deltas in the northeast. Most of the remainder of the peninsula—the interior uplands and most of the east—is sparsely populated. The bulk of the population of the peninsula's urban centres is Chinese and Malay, with Indians and Pakistanis forming a small but salient minority.

The population density of East Malaysia is considerably less than that of the rest of the country. As on the peninsula, settlements are concentrated along the coasts and rivers. In Sarawak the density of people in the southwest makes this region the most important in East Malaysia. In Sabah the population is similarly clustered on the coast, but riverine settlements are less important there than they are in Sarawak. Malays are less prominent in Sabah's cities than on the peninsula; Chinese, various non-Malay indigenous peoples, and, in some areas, Indonesians account for the vast majority of the urban population.

Malaysia's economy has been transformed since 1970 from one based primarily on the export of raw materials (rubber and tin) to one that is among the strongest, most diversified, and fastest-growing in Southeast Asia. Primary production remains important: the country is a major producer of rubber and palm oil, exports considerable quantities of petroleum and natural gas, and is one of the world's largest sources of commercial hardwoods. Increasingly, however, Malaysia has emphasized export-oriented manufacturing to fuel its economic growth. Using the comparative advantages of a relatively inexpensive but educated labour force, well-developed infrastructure, political stability, and an undervalued currency, Malaysia has attracted considerable foreign investment, especially from Japan and Taiwan.

Since the early 1970s the government has championed a social and economic restructuring strategy, first known as the New Economic Policy (NEP) and later as the New Development Policy (NDP), that has sought to strike a balance between the goals of economic growth and the redistribution of wealth. The Malaysian economy has long been dominated by the country's Chinese and South Asian minorities. The goal of the NEP and the NDP has been to endow the Malays (Malay) and other indigenous groups with greater economic opportunities and to develop their management and entrepreneurial skills. Official economic policy also has encouraged the private sector to assume a greater role in the restructuring process. A major component of this policy has been the privatization of many public-sector activities, including the national railway, airline, automobile manufacturer, telecommunications, and electricity companies.

The main food crop, rice, is grown on small farms. Despite the widespread advances brought about by the introduction of improved plant varieties and chemical fertilizers and pesticides (the so-called Green Revolution of the 1960s and '70s), rice production declined steadily during the second half of the 20th century. The main causes of this decline were unfavourable weather conditions and the loss of farm labour to urban manufacturing jobs. Increasingly deficient in rice production, the country has been forced to make up the shortfall with imports, chiefly from Thailand. Consequently, the government has taken measures to raise its self-sufficiency in rice, largely by implementing programs to consolidate smallholdings and to increase labour productivity through group farming schemes; by 2000 production had begun to rise, despite the continued labour shortage.

The extensive forests of both Peninsular Malaysia and East Malaysia are heavily exploited for their timber. The lowland evergreen tropical rain forest, rich in species of the economically valuable Dipterocarpaceae family, is the principal forest formation of commercial importance. Sarawak and Sabah account for the greater part of all timber production. Concern has been raised, however, about the pace of deforestation caused by the combination of shifting agriculture and intensive logging operations in East Malaysia. Attempts have been made to curtail log exports from the region and to substitute wood-based industries, such as the manufacture of plywood and furniture. Logging remains important in Peninsular Malaysia, although much of the easily accessible timber has been cut. The region also has a long history of careful forest management and conservation. The government in 2005 launched a forest plantation scheme—part of a sustainability initiative pitched to the private sector—to plant lands primarily with rubberwood but also with acacia, teak, and an easily workable hardwood called sentang.

Malaysia is rich in mineral resources, and mining (including petroleum extraction) accounts for a significant portion of GDP, although it employs only a tiny fraction of the workforce. The major metallic ores are tin, bauxite (aluminum), copper, and iron. A host of minor ores found within the country include manganese, antimony, mercury, and gold. Tin is found largely in alluvial deposits along the western slopes of the Main Range in Peninsular Malaysia, with smaller deposits on the east coast of the peninsula; its production formed one of the pillars of the country's economic development in the mid-20th century. Malaysia's bauxite production is centred near Johor at the south end of the peninsula, while the country's copper comes from western Sabah.

Since the 1970s, tin output has declined dramatically because of the depletion of readily accessible alluvial deposits, rising mining costs, and fluctuating demand in the world tin market. Nevertheless, the country has remained among the world's top suppliers of tin. Production of other minerals (except petroleum) similarly decreased during the last decades of the 20th century, although the mining of iron ore began to rebound in the mid-1990s.

Malaysia's most valuable mineral resources are its reserves of petroleum and natural gas. Crude oil, refined petroleum, and, more recently, liquefied natural gas together account for a major portion of the country's commodity export earnings. Almost all the major oil and gas fields are offshore—off the east coast of the peninsula, the northeast coast of Sarawak, and the west coast of Sabah.

Growth has been especially notable in the assembly of electronic equipment, electrical machinery, and appliances, as well as in the production of chemicals and textiles. There also has been substantial development of a variety of heavy industries, including steelmaking and automobile production—the latter implemented through a Malaysian-Japanese joint venture. Peninsular Malaysia, especially the urban area of Kuala Lumpur and the rest of the developed zone along the western side of the peninsula, is responsible for the bulk of the country's manufacturing output.

One strategy designed to promote manufactured exports has been the establishment of a number of free-trade zones, which have provided duty-free access to imported raw materials and semifinished parts in addition to numerous investment and export incentives. Industrial estates also have been established in less-developed parts of the country to stimulate manufacturing and to balance industrial growth, but manufacturing capacity has remained highly concentrated. The country's heavy industries—more important politically than economically—generally have been saddled with excess capacity and high production costs. Increasingly, development strategy has shifted to the promotion of small and medium industries that manufacture their own parts and acquire technology from more economically developed countries, the aim being to move beyond the stage of assembly-only manufacturing. Such initiatives have enabled Malaysian industries such as automobile manufacturing to move from assembly-only production in the mid-1980s to full-fledged production—with minimal reliance on imported components—in the 21st century.

Malaysia's export structure shifted dramatically during the last decades of the 20th century, from one dominated by rubber and tin to one in which manufactured goods accounted for well over half of all export earnings by the early 21st century. Electrical and electronic products constitute the largest proportion of exported manufactures. Commodities exports, however, especially palm oil and rubber, remain important. Imports are dominated by electronics parts, machinery, and other manufactured goods. Malaysia's chief trading partners are Japan, Singapore (because of its status as an entrepôt port in the region), the United States, and mainland China. Other prominent partners include Thailand, Taiwan, Hong Kong, and South Korea. Malaysia belongs to the Association of Southeast Asian Nations ( ASEAN), and trade with member countries has been increasing.

Malaysia's rapid economic expansion has created a great demand for additional labour for the manufacturing, construction, and service sectors. Although the labour shortage has tended to increase wages—attracting many workers from rural regions—companies nevertheless have found it necessary to recruit foreign labour, primarily from Indonesia, the Philippines, Bangladesh, and Thailand. The presence of foreign workers in large numbers has become a source of social and political tension within Malaysia. Moreover, the rural-to-urban migration prompted by industrialization has led to severe labour shortages in the rural economy.

The primary role of the country's fiscal system is to raise revenue for governmental expenditure, and the greater part of its revenue is raised through taxation. Direct (income) taxes on companies (including petroleum companies) and individuals constitute the primary source of tax revenue. Indirect taxes (e.g., customs and excise duties), however, also contribute significantly to the national budget.

River transport is of great importance in East Malaysia, especially in Sarawak. In addition, Malaysia's long and accessible coastlines have fostered maritime trade for more than a millennium. Several ports, notably Port Kelang (the principal port) and Penang (George Town) on the Strait of Malacca (Malacca, Strait of), have become major container-handling facilities. Numerous other ports have been developed, including Tanjung Pelepas and Pasir Gudang in the southern state of Johor, Kuantan on the eastern coast of the peninsula, Kuching in Sarawak, and Kota Kinabalu in Sabah.

Air transport has grown rapidly, with passenger traffic increasing especially on the peninsula. An internal air network connects almost all Malaysian states. Airports in Penang, Kota Kinabalu, and Kuching have limited international service. In 1998 a new international airport opened in Sepang, about 30 miles (50 km) south of Kuala Lumpur, replacing the old international airport in Subang, about 15 miles (25 km) west of the capital city. The airport in Subang has continued to offer some domestic and specialized service.

The powers of the federal parliament are relatively broad and include the authority to legislate in matters concerning government finances, defense, foreign policy, internal security, the administration of justice, and citizenship. The constitution also provides that some issues may be addressed by either the federal legislature or a state legislature. Of the roughly 200 members of the House of Representatives, about two-thirds are from Peninsular Malaysia, one is from the federal territory of Labuan, and the remaining seats are divided fairly evenly between Sarawak and Sabah. Members are elected to office from single-member constituencies to terms of five years. The Senate consists of about six dozen members; of these, nearly two-thirds (including those from the federal territories of Kuala Lumpur and Labuan) are appointed by the paramount ruler on the recommendation of the prime minister, and the others are elected by the state legislative assemblies. Election to either house is by a simple majority, but amendments to the constitution require a two-thirds majority. A bill passed by both houses and sanctioned by the Yang di-Pertuan Agong becomes a federal law.

Malaysia comprises 13 states and 3 federal territories. Each state has its own written constitution, legislative assembly, and executive council, which is responsible to the legislative assembly and headed by a chief minister. The federal territories, which include the capital city region of Kuala Lumpur, the administrative capital of Putrajaya, and the island of Labuan off the coast of East Malaysia, carry the same status as states, but they do not have separate legislatures or heads of state.

Most of the peninsular states are led by hereditary rulers. Johor, Kedah, Kelantan, Pahang, Perak, Selangor, and Terengganu have sultans (sultan), while Perlis has a raja (“king”), and Negeri Sembilan is ruled by the Yang di-Pertuan Besar (“chief ruler”). The heads of state of Melaka, Penang Island (Pulau Pinang; also Penang), Sarawak, and Sabah—known as Yang di-Pertuan Negeri (“state ruler”)—are appointed to office. The ruler of a state acts on the advice of the state government. The constitution provides for federal parliamentary elections and for elections to state legislatures, to be held at least every five years.

All states in Malaysia are subdivided into districts. In Sarawak and Sabah, however, these districts are grouped into larger administrative units called divisions. The village, headed by a tua kampung (“village leader”), is the smallest unit of government.

Each High Court consists of a chief judge and a number of other justices. The High Court has criminal and civil jurisdiction and may pass any sentence allowed by law. Below each High Court are three subordinate courts: the Sessions Court, the Magistrates' Court, and the Court for Children. These lower courts have criminal and civil jurisdiction—criminal cases come before one or the other court depending on the seriousness of the offense and civil cases depending on the sum involved. In addition, there are religious courts in those Malay states that are established under Islamic law (syariah, or Sharīʿah). These Islamic courts are governed by state—not federal—legislation.

Malaysia has a multiparty political system; the country has held free elections and generally has changed prime ministers peacefully. All citizens who are at least 21 years old are permitted to vote. Although their numbers in political positions have been increasing since the late 20th century, women have remained underrepresented in the political process. Most ministerial appointments are held by Malays, but a few posts are filled by indigenous and nonindigenous minorities.

Party affiliation generally is based on ethnicity, although this tendency has diminished somewhat since the mid-20th century. Malaysian political life and government has been dominated since the early 1970s by the National Front (Barisan Nasional), a broad coalition of ethnically oriented parties. Among the oldest and strongest of these parties are the United Malays National Organization (UMNO; long the driving force of the National Front), the Malaysian Chinese Association (MCA), the Malaysian Indian Congress (MIC), and several parties from Sarawak and Sabah, including Sarawak United Peoples' Party (SUPP) and the Sabah United Party (Parti Bersatu Sabah; PBS). The main opposition parties are the Democratic Action Party (DAP), which consists primarily of Chinese; the Pan-Malaysian Islamic Party (Parti Islam SeMalaysia; Pas); and, since the early 21st century, the People's Justice Party (Parti Keadilan Rakyat; PKR). There are also a number of smaller parties based mainly in Sarawak and Sabah.

The Malaysian armed forces have increased in strength and capability since the formation of Malaysia in 1963. After the withdrawal of British military forces from Malaysia and Singapore at the end of 1971, a five-country agreement between Malaysia, Singapore, New Zealand, Australia, and the United Kingdom was concluded to ensure defense against external aggression. Additional regional security is provided by ASEAN.

The armed forces consist of an army, a navy, and an air force. The army is the most experienced and the largest of the three units, constituting roughly three-fourths of all military personnel. The Royal Malaysian Navy concentrates mainly on defending the long indented coastlines and narrow waters of the country. The Royal Malaysian Air Force has combat aircraft as well as many transport aircraft and helicopters. Military service is voluntary, with a minimum age requirement of 18 years.

The states of Malaysia inherited from their common colonial past an internal security system based on the British model. The police force is well trained and combats not only crime but also armed insurrections. As a paramilitary unit, the police are separate from the armed forces.

The general level of health improved considerably in the second half of the 20th century. This improvement not only contributed significantly to a decline in death and infant-mortality rates but also, by the 21st century, largely freed Malaysia from many of the diseases that plague tropical countries. Such diseases as malaria remain a problem in some rural areas, however. Health conditions and health facilities vary among the states, but facilities are generally better equipped and staffed in Peninsular Malaysia than in Sabah and Sarawak. Health services generally are more extensive in the towns and cities than in the rural areas. Segments of the rural population often rely to some extent on traditional treatments rather than on doctors and medicines that are the product of formal research and academic training. Most health services are provided by the government. Welfare services, however, are provided by both government and private agencies and include relief programs for senior citizens, for the economically disadvantaged, and for people with disabilities.

The multicultural character of the population of Malaysia is visibly reflected in the wide variety of houses, which range from the traditional longhouses and stilt houses of the rural peoples to examples of modern high-rise architecture in the cities. Housing shortages are rare in rural areas, but squatter settlements are common in the larger towns and cities. A governmental housing authority has had success in establishing low-cost housing in urban areas.

The number of students advancing to the postsecondary level rose rapidly in the late 20th and early 21st centuries. The country offers dozens of tertiary institutions, including universities, teacher-training colleges, and other public and private institutions with assorted specializations. Among the most prominent institutions of higher learning are the University of Malaya (1962) in Kuala Lumpur, the University of Science, Malaysia (1969) in Penang, the National University of Malaysia (1970) in Bangi, and the International Islamic University (1983) in Kuala Lumpur. Major state universities were established in Sarawak and Sabah in the mid-1990s.

Malaysia is a point of convergence of several major cultural traditions that stem from archipelagic Southeast Asia as well as from China, South Asia, the Middle East, and the West. Malay culture, the Orang Asli cultures of Peninsular Malaysia, and many of the cultures of East Malaysia are indigenous to the area. In the first one and a half millennia CE, indigenous Malay culture in the Malay Peninsula and in other parts of Southeast Asia was strongly marked by pre-Islamic Indian and early Islamic influences. Indian contact with the Malay Peninsula, which extended from about the 2nd or 3rd century to the late 14th century, exerted a profound influence on religion (through Hinduism and Buddhism), art, and literature. Islam (Islām), introduced to Malacca (now Melaka) in the 15th century, soon became the dominant religion of the Malays. Western cultural influences, especially since the 19th century, also have affected many aspects of Malay life, particularly in the realms of technology, law, social organization, and economics. Contemporary Malay culture is thus multifaceted, consisting of many strands—indigenous, early Hindu, early and modern Islamic, and, especially in the cities, Western—interwoven to yield a pattern that is distinct from other cultures yet recognizably Malay.

The early Chinese traders who settled in Malacca and on the island of Penang were partially assimilated (at least to the extent of adopting the Malay language). By contrast, the Chinese who emigrated in large numbers to the Malay Peninsula in the late 19th and early 20th centuries were both a more heterogeneous group and a largely transient population that tended to establish self-contained communities. Chinese cultural influence in this region, then, has been less pronounced.

Most of the Indians and Pakistanis originally came as labourers to work in the coffee and rubber plantations from the mid-19th to the early 20th centuries. Like the Chinese, they also were mainly transients (until World War II), living in closed communities and remaining relatively unassimilated.

The communities of Malaysia have been affected profoundly by British colonial rule and Western cultural influences, especially in education and institutional forms. The rural areas—particularly in eastern Peninsular Malaysia and in the interior of East Malaysia—have been least affected, while the cities have been the focus of the most-rapid cultural changes. However, extraordinary economic growth and development since the mid-20th century increasingly has allowed a cosmopolitan outlook, carried largely from the urban centres by an expanding middle class, to penetrate smaller towns and even newer rural settlements.

Beyond the official holidays and other religious festivities, important life events such as birth, circumcision (for young Muslim men), and marriage are usually celebrated by a feast, known in Malay as kenduri. The wedding ceremony is generally the most important and elaborate of such events among both Malay and non-Malay peoples. In rural areas the kenduri is normally held at the house of the host family, while in urban areas the feast often takes place in a large hall or hotel.

Malaysian cuisines reflect the mixture of ethnic groups in the country's population. The three most prominent cuisines are Chinese, Indian, and Malay. Popular Chinese foods include sweet-and-sour Cantonese dishes and a milder favourite, Hainanese chicken rice. Indian cuisine ranges from the hot vegetarian dishes of southern Indian cooking to the more subtly spiced Muslim Indian food to the yogurt-marinated meats of tandoori cookery from northern India. All these foods, while recognizably Chinese or Indian, have developed a distinctly Malaysian character.

Traditional Malay cuisine consists of white rice served with various curries and fried dishes. Sate, small skewers of chicken or beef dipped in a spicy peanut sauce, nasi goreng (“fried rice”), and nasi lemak (“fatty rice”), which is coconut rice served with fried anchovies, peanuts, and a curry dish, are among the most common Malay foods. Noodles, cooked and served in various styles, are also local favourites.

Non-Muslim indigenous peoples of Peninsular and East Malaysia typically eat a staple food such as rice, tapioca, or sago served with locally grown or gathered vegetables (e.g., ferns and tapioca leaves) and fish, wild boar, venison, or other game. The food is generally not spicy or only mildly so.

The history and cultural life of Malaysia are exhibited primarily in various museums in Kuala Lumpur and several state capitals throughout the country. Built in a Malay architectural style in 1963, the National Museum in Kuala Lumpur houses a diverse archaeological and ethnographic collection that documents Malaysia's social, cultural, artistic, and economic history. The Perak Museum in Taiping is the oldest museum in Peninsular Malaysia and contains collections of the natural history and material culture of the region. The Penang Museum and Art Gallery highlights Penang Island's immigrant and colonial history. In East Malaysia, the Sabah Museum in Kota Kinabalu and the Sarawak Museum in Kuching, both established in the late 19th century, chronicle the unique prehistory and history of these states and their peoples.

In addition to the broadly ethnographic or historical museums, there also are numerous institutions dedicated to the documentation of particular Malaysian phenomena. The Islamic Arts Museum in Kuala Lumpur, for instance, traces the advent and growth of the art and culture of Islam in Malaysia from the 7th century to contemporary times. Other such topical museums include a numismatic museum, a museum of telecommunications, and an armed forces museum, all located in the capital city.

Malaysia is home to many art galleries and theatres for the performing arts as well. The National Art Gallery has permanent exhibitions of modern paintings by Malaysian artists and rotating exhibitions of art from around the world. Plays, dances, and musical productions by Malaysian and international performers are staged regularly at the grand national theatre, called the Istana Budaya (“Palace of Cultures and Arts”), in Kuala Lumpur.

Traditional sports also enjoy local popularity. top-spinning (main gasing) competitions are seriously contested, with winning tops often spinning for well over an hour. In some areas, top spinning is not merely a random pastime but is associated with the agricultural cycle. Kite flying also is a favourite activity, as are bird-singing contests, which may feature hundreds of birds, all with unique songs. Sepak takraw (“kick ball”) is a uniquely Southeast Asian game (now played in other regions) that is similar to volleyball but is played with a woven rattan ball and without using the hands. The sport is internationally competitive, and Malaysia has fronted winning teams.

Malaysia made its debut at the Summer Olympic Games in Melbourne in 1956. At the 1992 and 1996 Summer Games the country took medals in men's badminton. Malaysia was one of the founders of the biennial Southeast Asian Games and has hosted the event several times since its inception in 1957.

The press is the principal source of information in urban areas of Malaysia. The newspapers are all privately owned (many by political parties) and vary greatly in circulation, quality of reporting, and news coverage. Dozens of daily papers circulate in all the major languages of the country, including Malay, English, Chinese, and Tamil. In Sabah several dailies also are issued in the Kadazan language.

Although many public and private radio stations cater to urban listeners, radio is the primary information channel in remote rural areas. Both on the peninsula and in East Malaysia, the government-operated Radio Television Malaysia (RTM) broadcasts in Malay, English, and assorted Chinese languages, as well as in various indigenous languages, such as Iban in Sarawak. RTM also broadcasts internationally in Arabic, English, Chinese, and the national languages of several of Malaysia's Southeast Asian neighbours.

Television is a popular medium across geographical and linguistic boundaries. The government had a monopoly on television broadcasting until the mid-1990s, when it opened the industry to private operators. Since that time several commercial stations have been established, and the emergence of private cable and satellite companies has allowed television broadcasting to reach the most remote rural regions of the country.

Extending well into the western zone of the Southeast Asian archipelago, the Malay Peninsula has long constituted a critical link between the mainland and the islands of Southeast Asia. Because Malaysia itself is divided between the two regions, the history of the country can be understood only within a broad geographic context. The Strait of Malacca (Malacca, Strait of), narrowly separating the peninsula from the archipelago, has been a crossroads for peoples, cultures, and trade passing through or taking root in both areas. Influences from china, India, the Middle East, and, later, Europe followed the maritime trade. Peninsular Malaysia and the two states of East Malaysia, Sarawak and Sabah, have shared many historical patterns, but each region also has developed in unique ways.

Malaysia's prehistory remains insufficiently studied, but bone and artifact discoveries at the Niah Cave site in northern Sarawak confirm that the area was already inhabited by Homo sapiens about 40,000 years ago. The vast cave complex contains remains that not only indicate a nearly unbroken succession of human visits and occupations but also chronicle the evolution of stone tools until some 1,300 years ago. Peninsular Malaysia has been inhabited for at least 6,000 years, archaeologists having unearthed evidence of Stone Age and early Bronze Age civilizations; Neolithic (Neolithic Period) culture was apparently well established by 2500 to 1500 BCE. Early historical studies postulated that successive waves of peoples—ancestors of the contemporary Malays—migrated into the region from China and Tibet during the 1st millennium BCE, pushing earlier inhabitants into the western Pacific or remote mountain enclaves. More recently it has been suggested that the southward migration consisted of small groups who imposed their culture and language and created new ethnic fusions.

Small Malay kingdoms appeared in the 2nd or 3rd century CE, a time when Indian traders and priests began traveling the maritime routes, bringing with them Indian concepts of religion, government, and the arts. Over many centuries the peoples of the region, especially those within the royal courts, synthesized Indian and indigenous ideas, making selective use of Indian models—including Hinduism and Mahayana Buddhism—in shaping their political and cultural patterns. The most significant complex of Indianized temple ruins has been found around Kedah Peak in northwestern Peninsular Malaysia.

Because the peninsula and northern Borneo both lacked broad, fertile plains, they were unable to support the high population densities that were the foundation of other, more powerful Southeast Asian civilizations, such as those that flourished on the island of Java and on the mainland in what is now Cambodia. However, scant documentation, chiefly from Chinese written sources, suggests that perhaps 30 small Indianized states rose and fell in Malaya—the Malay region of the peninsula—during the 1st millennium CE. The most important of these states, Langkasuka, controlled much of the northern part of the region.

Malaya developed an international reputation, both as a source of gold and tin and as the home of renowned seafarers; as its reputation grew, however, Malaya increasingly was exposed (or subjected) to cultural influences from surrounding powers. Between the 7th and 13th centuries many of the region's small, often prosperous maritime trading states likely came under the loose control of Srivijaya (Śrivijaya empire), the great Indianized empire based in Sumatra. At various times, other Indianized powers of Southeast Asia—including the Khmer (Cambodian) empire based at Angkor, the Tai kingdom of Ayutthaya, and the Majapahit empire centred in eastern Java—also claimed suzerainty in the region. These early cultural forces in Malaya left a living legacy, traces of which are still evident in the political ideas, social structures, rituals, language, arts, and other traditions of Malay Muslims.

Although development was slower in more remote, less fertile northern Borneo, the area that is now Sarawak had entered the Iron Age by CE 600. Archaeological excavations in the Sarawak River delta have revealed much evidence not only of early ironworking but also of extensive trade with China and the Southeast Asian mainland. The local peoples offered edible bird's nests, rhinoceros horns, hornbill “ivory” (from the casque atop the bird's beak), camphor, spices, wood, and other goods in exchange for Chinese ceramics, metal, and probably clothing. Meanwhile, Neolithic boatbuilders along the east coast of present-day Sabah were involved in extensive interregional trade; the maritime peoples of the area called the territory the “land below the wind” because it lay south of the tropical cyclone (typhoon) belt.

From the 13th through the 17th century, Sunni Islam, carried chiefly by Arab and Indian merchants, spread widely through peninsular and insular Southeast Asia. The new religion offered equal-opportunity social advancement through spiritual devotion, which ultimately challenged (but did not entirely eliminate) the power of the traditional elites; Islam also embodied a complex theology that held much appeal for farmers and merchants in the coastal regions. The dissemination of Islam was intimately linked to the florescence of the great Indian Ocean trading (international trade) routes that connected China through the Strait of Malacca to India, the Middle East, and eastern Africa.

The mostly Islamicized people of 15th-century Malacca began calling themselves “Malays (Malay)” (“Melayu”), likely a reference to their Sumatran origins. Thereafter the term Malay was applied to those who practiced Islam and spoke a version of the Malay language. Religious and linguistic behaviour, rather than descent, then, became the criteria for being Malay; this enabled previously Hindu-Buddhist peoples and former adherents of local religions to identify themselves (and even merge) with the Malays—regardless of their ancestry. Over time this loose cultural designation became a coherent ethnic group populating what is commonly called the “Malay world,” a region encompassing Malaya, northern and western Borneo, eastern Sumatra, and the smaller islands in between. Islam, however, came to overlay the earlier beliefs so that, before the rise of religious reform movements in the 19th century, few Malays were orthodox Muslims. Hindu-influenced ritual remained important for those of noble heritage, and local spirits were richly incorporated into Islamic practices.

The fame of Malacca as the crossroads of Asian commerce had reached Europe by the beginning of the 16th century. The Portuguese, who for a century had been seeking a sea route to eastern Asia, finally arrived at Malacca in 1509, inaugurating a new era of European activity in Southeast Asia. Although much of Southeast Asia, including northern Borneo, experienced little Western impact before the 19th century, Malaya was one of the first regions to be disrupted. In 1511 a Portuguese fleet led by Afonso de Albuquerque (Albuquerque, Afonso de, the Great) captured Malacca.

Because few merchants of Malacca chose to endure the conquerors' high taxes and intolerance of Islam, the city ultimately languished under Portuguese control. The sultanate of Aceh (Acheh) in northern Sumatra subsequently leaped into the political vacuum created by Malacca's decline, and during the 16th and early 17th centuries the Acehnese were deeply involved in peninsular affairs, warring against various sultanates and at times controlling some or most of them. Indeed, the understaffed Portuguese authority in Malacca was barely able to repulse repeated assaults by the sultanate of Aceh. Meanwhile, the Dutch, having established the Dutch East India Company in 1602, arose as the dominant European power in Southeast Asia. In 1641 the Dutch seized Malacca, and although they tried to revive its trade, the city never recovered its earlier glory.

Throughout the rise and fall of Malacca, new sultanates were emerging elsewhere in the Malay world. They usually were situated at the mouth of a major river and sought to control trade to and from the interior, which often was populated by seminomadic peoples such as the aboriginal Orang Asli (“Original People”) of Malaya and the various indigenous peoples of Borneo. Younger sultanates—such as Riau-Johor and Kedah, both on the peninsula, and Brunei, on Borneo's northern coast—took over some of the trading functions of Malacca and flourished for several centuries. Islam reached other areas of northern Borneo in the 15th and 16th centuries; many coastal peoples converted, but most of the inhabitants of the interior continued to practice local religions well into the 20th century. Malay political control spread, with the Brunei sultans laying claim to much of what are today Sarawak and Sabah—although their actual power seldom reached much beyond the coastal zone. Attempts by Brunei to control the interior often failed, especially after the aggressive Iban (Sea Dayak) people commenced their migrations into present-day Sarawak from western Borneo (16th through 18th centuries). The Siamese came to control some of the northern Malay sultanates, and the southernmost part of present-day Thailand still has a predominantly Malay Muslim population. The Malay sultanates included many, often feuding chiefdoms. Consequently, wars within and between the sultanates erupted from time to time. From the Europeans' perspective, the sultanate system—with its hierarchical but fluctuating spheres of influence over mobile populations—was politically unstable.

During the 17th century many Minangkabau people migrated from western Sumatra into southwestern Malaya, bringing with them a matrilineal sociocultural system by which property and authority descended through the female side. They elected their chiefs from among eligible aristocratic candidates, a model that has been incorporated into contemporary Malaysia's selection of a king. Later the Minangkabau formed a confederation of nine small states ( Negeri Sembilan). The political pluralism of Malaya in the 18th century also facilitated large-scale penetration of the peninsula by Buginese people from southwestern Celebes (Sulawesi), a large island to the southeast of Borneo that is now part of Indonesia. With a well-earned reputation as maritime traders, Buginese immigrants established the sultanate of Selangor on the west coast of Malaya in the mid-1700s. To the southeast, they gained prominence in the sultanate of Johor, which, at the tip of the peninsula, was a prosperous trading entrepôt that attracted Asian and European merchants. Despite continuous movement of peoples from the archipelago into the area, Malaya and northern Borneo remained sparsely populated into the early 19th century. Many present-day Malays are descendants of immigrants from elsewhere in archipelagic Southeast Asia who arrived after 1800. Indeed, immigrants from Java, Celebes, and Sumatra demonstrated a tendency to assimilate to the existing Malay community over time, a process that steadily accelerated with the rise of Malay nationalism and vernacular education in the 1930s. Some of the traditions brought by Minangkabau, Javanese, and other immigrants are still practiced in districts where they settled, contributing to the many regional variations of Malay culture and language.

Except for Malacca (Malacca, sultanate of), Western influence was negligible in Malaya and northern Borneo until the late 18th century, when Britain became interested in the area. The British sought a source for goods to be sold in china, and in 1786 the British East India Company acquired the island of Penang (Pulau Pinang), off Malaya's northwest coast, from the sultan of Kedah. The island soon became a major trading entrepôt with a chiefly Chinese population. British representative Sir Stamford Raffles (Raffles, Sir Stamford) occupied the island of Singapore off the southern tip of the peninsula in 1819 and acquired trading rights in 1824; a strategic location at the southern end of the Strait of Malacca (Malacca, Strait of) and a fine harbour made Singapore the centre for Britain's economic and political thrust in the peninsula. The British attracted Chinese immigrants to the sparsely populated island, and soon the mainly Chinese port became the region's dominant city and a major base for Chinese economic activity in Southeast Asia. By then the predominant industrial capitalist power in Europe, Britain next obtained Malacca from the Dutch in 1824 and thereafter governed the three major ports of the Strait of Malacca—Penang, Malacca, and Singapore—which collectively were called the Straits Settlements. The British Colonial Office took direct control in 1867.

With the opening in 1869 of the Suez Canal, which provided a dramatically shorter maritime route between Europe and Southeast Asia, the full effect of European technological development swept over the region. The feuding Malay states were little prepared for the political ramifications of increased European commercial activity, with the exception of Johor, which was led by the strong, shrewd, and progressive sultan Abu Bakar. The other state administrations generally were weak and failed to cope with their mounting problems, including the steady immigration of Chinese. By the early 19th century the Chinese—who were being driven to emigrate by increasing poverty and instability in their homeland—began settling in large numbers in the sultanates along the peninsula's west coast, where they cooperated with local Malay rulers to mine tin. The Chinese organized themselves into tightly knit communities and formed alliances with competing Malay chiefs, and Chinese factions fought wars with each other for control of minerals. Chinese settlers also established towns such as Kuala Lumpur and Ipoh, which later grew into major cities. The Chinese and Malays increasingly became entrenched in an inadequately integrated sociopolitical structure that continually generated friction between the two communities.

British investors were soon attracted to Malaya's potential mineral wealth, but they were concerned about the political unrest. As a result, by the 1870s local British officials began to intervene in the internal affairs of various Malayan sultanates—establishing political influence (sometimes by force or the threat of force) through a system of British residents (advisers). Initial intervention was crude and incompetent; the first British resident to Perak was murdered by Malays outraged by his assertive actions. Gradually, the British refined their techniques and appointed more-able representatives; notable among these was Sir Frank Swettenham (Swettenham, Sir Frank), who in 1896 became the first resident-general of a Malay federation of Perak, Selangor, Negeri Sembilan, and Pahang, with Kuala Lumpur as the capital. By 1909 the British had pressured Siam (now Thailand) into transferring sovereignty over the northern Malay states of Kedah, Terengganu, Kelantan, and Perlis; Johor was compelled to accept a British resident in 1914. These five sultanates remained outside the Malay federation, however. Britain had now achieved formal or informal colonial control over nine sultanates, but it pledged not to interfere in matters of religion, customs, or the symbolic political role of the sultans. The various states kept their separate identities but were increasingly integrated to form British Malaya.

Northeastern Borneo, the territory that is now Sabah, was the last area to be brought under British control. In the early 1700s Brunei transferred its claims over much of the region to the sultan of Sulu, who ruled from the Sulu Archipelago (now part of the Philippines) to the east. Except in the far northeast, actual Sulu power remained limited. Occasional local resistance to Brunei or Sulu influence, as well as extensive coastal raiding and confusion of suzerainty, invited Western interest beginning in the 18th century. Despite short-lived American activity in the 1860s, British power proved most decisive. By 1846 the British had already acquired the offshore island of Labuan from Brunei. They gained a toehold in northeastern Borneo proper in 1872, when British merchant William Cowie founded an east-coast settlement at Sandakan, on lease from Sulu. Having obtained rights to much of the territory by 1881, the British launched the British North Borneo Company, which, based in Sandakan, ruled the British protectorate—as North Borneo—until 1941. The company operated the state in the interest of its shareholders but was only moderately prosperous, owing to high overhead and poor management; its 60 years of rule, however, established the economic, administrative, and political framework of contemporary Sabah.

The British presence in the region reflected several patterns: direct colonial rule in the Straits Settlements, relatively indirect control in some of the peninsula's east-coast sultanates, and family or corporate control in Borneo. Regardless of the political form, however, British rule brought profound changes, transforming the various states socially and economically.

The Brookes and the North Borneo Company faced prolonged resistance before they consolidated their control, while occasional local revolts punctuated British rule in Malaya as well. In Sarawak in 1857, for example, interior Chinese gold-mining communities nearly succeeded in toppling the intrusive James Brooke before being crushed, while Muslim chief Mat Salleh fought expanding British power in North Borneo from 1895 to 1900. The Brookes mounted bloody military campaigns to suppress headhunting (practiced at the time by many indigenous peoples of the interior) and to incorporate especially the Iban into their domain; similar operations were carried out in North Borneo. Those who resisted British annexation or policies were portrayed by the British authorities as treacherous, reactionary rebels; many of the same figures, however, were later hailed in Malaysia as nationalist heroes.

The British administration eventually achieved peace and security. In Malaya the Malay sultans retained their symbolic status at the apex of an aristocratic social system, although they lost some of their political authority and independence. British officials believed that the rural Malay farmers needed to be protected from economic and cultural change and that traditional class divisions should be maintained. Hence, most economic development was left to Chinese and Indian immigrants, as long as it served long-term colonial interests. The Malay elite enjoyed a place in the new colonial order as civil servants. Many Malayan and Bornean villagers, however, were affected by colonial taxes and consequently were forced to shift from subsistence to cash-crop farming; their economic well-being became subject to fluctuations in world commodity prices. Much economic growth occurred; British policies promoted the planting of pepper, gambier (a plant producing a resin used for tanning and dyeing), tobacco, oil palm, and especially rubber, which along with tin became the region's major exports. Malaya and British North Borneo developed extractive, plantation-based economies oriented toward the resource and market needs of the industrializing West.

British authorities in Malaya devoted much effort to constructing a transportation infrastructure in which railways and road networks linked the tin fields to the coast; port facilities also were improved to facilitate resource exports. These developments stimulated growth in the tin and rubber industries to meet world demand. The tin industry remained chiefly in immigrant Chinese hands through the 19th century, but more highly capitalized, technologically sophisticated British firms took over much of the tin production and export by World War II. The rubber tree was first introduced from Brazil in the 1870s, but rubber did not supersede the earlier coffee and gambier plantings until near the end of the century. By the early 20th century thousands of acres of forest had been cleared for rubber growing, much of it on plantations but some on smallholdings. Malaya became the world's greatest exporter of natural rubber, with rubber and tin providing the bulk of colonial tax revenues.

The British also improved public health facilities, which reduced the incidence of various tropical diseases, and they facilitated the establishment of government Malay schools and Christian mission (mostly English-language) schools; the Chinese generally had to develop their own schools. These separate school systems helped perpetuate the pluralistic society. Some Chinese, Malays, and Indians benefited from British economic policies; others enjoyed no improvement or experienced a drop in their standard of living. Government-sanctioned opium and alcohol use provided a major source of revenue in some areas.

Between 1800 and 1941 several million Chinese entered Malaya (especially the west-coast states), Sarawak, and British North Borneo to work as labourers, miners, planters, and merchants. The Chinese eventually became part of a prosperous, urban middle class that controlled retail trade. South Indian Tamils (Tamil) were imported as the workforce on Malayan rubber estates. At the turn of the 19th century Malays accounted for the vast majority of Malaya's residents, but the influx of immigrants over the subsequent decades significantly eroded that majority. A compartmentalized society developed on the peninsula, and colonial authorities skillfully utilized “divide and rule” tactics to maintain their control. With most Malays in villages, Chinese in towns, and Indians on plantations, the various ethnic groups basically lived in their own neighbourhoods, followed different occupations, practiced their own religions, spoke their own languages, operated their own schools, and, later, formed their own political organizations. By the 1930s ethnically oriented nationalist currents began to stir in Malaya, Singapore, and Sarawak. Malay groups either pursued Islamic revitalization and reform or debated the future of the Malays in a plural society, while Chinese organizations framed their activities around political trends in China.

The Borneo states experienced many of the same changes. Sir Charles Brooke, second raja of Sarawak, passed the state on to his son, Charles Vyner de Windt Brooke, in 1917. Vyner Brooke reigned until 1946, furthering the pattern of personal rule established by his father and by his great-uncle, Sir James Brooke. Economic incentives attracted Chinese immigrants, and by 1939 the Chinese accounted for about one-fourth of the state's population. Similar to Malaya, Sarawak became ethnically, occupationally, and socially segmented, with most Malays in government or fishing, most Chinese in trade, labour, or cash-crop farming, and most Iban in the police force or shifting cultivation. Gambier and pepper were planted, with Sarawak emerging as the major world supplier of the latter crop. Later, rubber became dominant, and a petroleum industry developed. Most cash-crop agriculture remained in smallholdings rather than in the plantations that were characteristic elsewhere. Christian missionary activity and church, Chinese, and Malay schools also generated sociocultural change. In the 1930s ethnic consciousness rose among both the Chinese and the Malay communities as Vyner Brooke's personal rule began to erode.

The North Borneo Company operated differently from the Brookes in that it concentrated on developing an extractive economy for the benefit of its shareholders, based mostly on Western-owned tobacco and rubber estates and forest exploitation. Like the Brookes, however, the company created a single state out of many local societies and tolerated little open political activity. Christian missions facilitated change among non-Muslims. Significantly, immigrant Chinese and Indonesians also diversified the population through their employment as plantation workers.

The occupation of Malaya and Borneo by Japan (1942–45) during World War II generated tremendous changes in those territories. Their economies were disrupted, and communal tensions were exacerbated because Malays and Chinese reacted differently to Japanese control. The Japanese desperately needed access to the natural resources of Southeast Asia; they invaded Malaya in December 1941, having neutralized American military power in Hawaii through the Pearl Harbor attack and in the Philippines through attacks on Manila. Shortly thereafter, the Japanese controlled the peninsula, Singapore, and Borneo. Pro-communist, predominantly Chinese guerrillas waged resistance in Malaya, and a brief Chinese-led revolt also erupted in North Borneo. In many places increasing politicization and conflict within and among ethnic groups developed as a result of economic hardship and selective repression; in northern Borneo the rule of the Brookes and of the North Borneo Company was permanently undermined, while in Malaya the Chinese and Malays also realized that British domination was not everlasting. Nonetheless, most people welcomed the Japanese defeat in 1945.

After the end of the war, Sarawak and North Borneo, both of which had been British protectorates until the Japanese occupation, became British crown colonies. Sarawak, however, faced a turbulent political situation. Many Malays opposed the termination of Brooke rule and Sarawak's cession to Britain, and the resulting sociopolitical divisions persisted for years. With the establishment of the British North Borneo colony, the capital was moved from Sandakan to Jesselton (now Kota Kinabalu). Some local self-government was introduced in Malaya. The major catalyst of political organization, however, was a British proposal to form a single Malayan Union, incorporating all the Malayan territories except Singapore, that would diminish state autonomy and accord equal political and citizenship rights to non-Malays. A tremendous upsurge of Malay political feeling against this plan, led by Dato' Onn bin Jaafar (Onn bin Jaafar, Dato'), resulted in the creation in 1946 of the United Malays National Organization (UMNO) as a vehicle for Malay nationalism and political assertiveness. Strikes, demonstrations, and boycotts doomed the proposed Malayan Union, and the British began to negotiate with UMNO about the Malayan future.

The negotiations resulted in the creation in 1948 of the Federation of Malaya, which unified the territories but provided special guarantees of Malay rights, including the position of the sultans. These developments alarmed the more radical and impoverished sectors of the Chinese community. In 1948 the Communist Party of Malaya—a mostly Chinese movement formed in 1930 that had provided the backbone of the anti-Japanese resistance—went into the jungles and began a guerrilla insurgency to defeat the colonial government, sparking a 12-year period of unrest known as the Malayan Emergency. The communists waged a violent and ultimately futile struggle supported by only a small segment of the Chinese community. The British took measures to suppress the insurgency by military means, which included a strategy that forcibly moved many rural Chinese into tightly controlled New Villages located near or along the roadsides. Although this policy isolated villagers from guerrillas, it also increased the government's unpopularity. The British finally achieved success when, under the leadership of British high commissioner Sir Gerald Templer, they actively began to address political and economic grievances as well as the insurgency, which further isolated the rebels.

Promising independence, British officials commenced negotiations with the various ethnic leaders, including those of UMNO and the Malayan Chinese Association (MCA), formed in 1949 by wealthy Chinese businessmen. A coalition consisting of UMNO (led by the aristocratic moderate Tunku Abdul Rahman (Abdul Rahman Putra Alhaj, Tunku)), MCA, and the Malayan Indian Congress contested the national legislative elections held in 1955 and won all but one seat. This established a permanent political pattern of a ruling coalition—known first as the Alliance Party and later as the National Front (Barisan Nasional)—that united ethnically based, mostly elite-led parties of moderate to conservative political leanings, with UMNO as the major force.

On Aug. 31, 1957, the Federation of Malaya achieved independence under an Alliance government headed by Tunku Abdul Rahman as prime minister. Singapore, with its predominantly Chinese population, remained outside the federation as a British crown colony. The arrangement tended to favour the Malays politically, with UMNO leaders holding most federal and state offices and the kingship rotating among the various Malay sultans, but the Chinese were granted liberal citizenship rights and maintained strong economic power. Kuala Lumpur became the federal capital.

New currents also were emerging in Borneo. Colonial rule succeeded in rebuilding and expanding the economies of the two colonies, with rubber and timber providing the basis for postwar economic growth. Health and education facilities slowly reached beyond the towns. Political consciousness began to spread as elections were held for local councils. During the 1950s the Kadazan community, stimulated particularly by the development of radio broadcasting and newspapers, became involved in North Borneo politics, while Chinese and Malay leaders formed Sarawak's first political parties—some espousing multiethnic identities—in expectation of independence. Political activity accelerated with the mooting in 1961 of the proposal by Malayan and British officials for a federated state that would include Malaya, Sarawak, North Borneo, Brunei, and Singapore. New parties formed in North Borneo representing the Kadazan, Chinese, and various Muslim communities. Elections were held in North Borneo and in Sarawak, with most of the parties in both colonies accepting independence through merging with the new federation, called Malaysia; the inclination to join Malaysia increased after the Philippines claimed North Borneo, based on former Sulu suzerainty.

British leaders proposed a Malaysian federation as a way of terminating their now burdensome colonial rule over Singapore, Sarawak, and North Borneo, even though those states were historically and ethnically distinct from Malaya and from each other. It was in many ways to be a marriage of convenience. Malaya was closely linked economically with bustling Singapore, and the Malays felt a kinship to the various Muslim groups in Borneo. Tunku Abdul Rahman believed the federation could defuse potential leftist Chinese activity while balancing the Chinese majority in Singapore with the non-Chinese majorities of the Borneo states. Malaya already contained a Chinese minority of nearly 40 percent, with Malays barely in the majority there. Hence, on Sept. 16, 1963, the Federation of Malaysia was formed, with North Borneo—renamed Sabah—and Sarawak constituting East Malaysia. Brunei, which had been invited to join, chose to remain a British protectorate and later became independent as a small, oil-rich Malay sultanate.

The new, hurriedly formed country faced many political problems, including a period of Indonesian military opposition that ended in 1966, sporadic communist insurgency in Sarawak, periodic disenchantment in East Malaysia over federal policies and the domination of Peninsular Malaysia, and the secession of Singapore from the federation (at Malaysia's urging) in 1965. The latter event resulted from increasing friction between the mostly Malay federal leaders and the mostly Chinese state leaders, especially Singapore's independent-minded chief minister, Lee Kuan Yew, who disagreed on national goals. Under Lee's autocratic direction and unconventional economic policies, Singapore became a highly prosperous but tightly controlled country, and relations with Malaysia gradually improved. Both countries became founding members of the Association of Southeast Asian Nations ( ASEAN) in 1967.

The secession of Singapore allowed UMNO to exercise more influence over federal policies, even if it did not end political uncertainties. Communal tensions on the peninsula following a heated election generated riots and a countrywide state of emergency in 1969–70. Many non-Malays resented the government's attempts to build national unity and identity through such measures as increasing the use of the Malay language in education and public life. The Chinese were particularly worried by government policies aimed at distributing more wealth to Malays. For instance, the New Economic Policy, launched in 1971 and renewed as the New Development Policy in 1991, was designed to increase significantly the wealth and economic potential of the bumiputra (Malays and other indigenous peoples)—especially the Malays. It included affirmative-action policies for bumiputra citizens in education and in employment in the civil service. A growing Islamic movement also fueled tensions in the country and wrought divisions within the Malay community itself. Beginning in the late 1970s, this Islamic fundamentalist revival, or dakwah movement, increasingly attracted the support of young Malays who felt alienated by what they perceived as the growth of a Westernized, materialistic society. Finally, although rural development policies reduced poverty rates, large pockets of urban and especially rural poverty persisted, with many regional and ethnic inequities in the distribution of wealth. Radical critics of the government (including communists, socialists, Islamic militants, and progressive intellectuals) were politically marginalized and sometimes detained.

For Sarawak and Sabah, politics within Malaysia proved to be a turbulent experience. The decision to join the federation was made in haste, and many people continued to resent the loss of their autonomy, especially their loss of control over growing petroleum revenues. Political crises occurred periodically in Sarawak, although it was governed after 1970 by a Malay-dominated, profederal but multiethnic coalition that represented a triumph of peninsular alliance-style politics. By the mid-1980s, however, some Iban leaders had challenged the coalition for being too accommodating to wealthy Malay and Chinese interests. The government encouraged the assimilation of Sarawak society to that of the peninsula and dramatically increased the exploitation of timber resources, often at the expense of interior peoples. Sabah politics also were contentious, with ongoing tensions between Muslim and non-Muslim groups. Between 1967 and 1975 Chief Minister Tun Mustapha ruled the state rigidly, absorbing or repressing opponents, promoting Islam, and challenging federal policies. The multiethnic coalition that replaced Mustapha continued to preside over rapid economic growth spurred by the exploitation of Sabah's bountiful natural resources. Tensions resurfaced in the mid-1980s, however, when a Christian Kadazan-led party swept into power and followed policies opposed by federal leaders. Although peninsular sociopolitical patterns increasingly influenced Sabah and Sarawak, the states remained unique within the Malaysian system.

Despite these difficulties, the country as a whole maintained its quasi-democratic parliamentary political system, including regular elections and moderate political diversity but also some restrictions on civil liberties, such as a ban on public discussion of issues deemed “sensitive.” Tunku Abdul Rahman was succeeded as prime minister by Tun Haji Abdul Razak bin Hussein (Abdul Razak bin Hussein, Tun Haji) in 1970. Upon Abdul Razak's death in 1976, another UMNO leader, Datuk (later Tun) Hussein Onn, replaced him. In 1981 Tun Hussein Onn, owing to ill health, relinquished his positions as president of UMNO and as Malaysian prime minister, allowing Mahathir bin Mohamad to become the fourth prime minister and the first nonaristocrat to hold that office.

Mahathir's 22-year tenure as prime minister was marked by an authoritarian style and economic success. His assertive manner and controversial policies generated a major split within UMNO: in 1986 Deputy Prime Minister Musa Hitam resigned, citing irreconcilable differences, and the following year Mahathir only narrowly survived a challenge to his role as UMNO president (and thus as prime minister). A subsequent challenge to Mahathir's victory led the courts to declare UMNO illegal because it had failed to register properly. Mahathir was able to outmaneuver his opponents, however, by dissolving UMNO and forming a new Malay party, UMNO Baru (New UMNO; Baru was subsequently dropped in 1997 and the original name restored). Mahathir's opponents countered by forming Semangat '46 (Spirit of '46), which claimed to embody the ideals of the original UMNO (established in 1946) and attempted to unite the disparate opposition groups against the National Front, which was headed by UMNO.

During the 1980s Anwar Ibrahim rose rapidly within the ruling party, and many believed he was being groomed to be Mahathir's successor. In 1993 Anwar was elected deputy president of UMNO and deputy prime minister, and within a few years he was considered a potential contestant for the offices of UMNO president and prime minister of Malaysia. In 1997 the country faced a severe economic downturn, and Mahathir and Anwar (who also served as the country's finance minister) differed over the economic prescriptions necessary to rescue the economy. In September 1998 Mahathir removed Anwar from office, and Anwar subsequently was expelled from UMNO and charged with (and, eventually, convicted of) corruption and sexual misconduct. Demonstrations, under the banner of reformasi (“reform”), ensued in support of Anwar, whose backers claimed that the charges were a bid to humiliate him and to eliminate him as a potential rival of Mahathir.

The dismissal of Deputy Prime Minister Anwar caused intense divisions within Malaysia, but Mahathir, benefiting from an economic recovery, was able to retain his grip on political power. In 2003 Mahathir stepped down as prime minister and was replaced by Abdullah Ahmad Badawi (his handpicked successor), who won a landslide victory the following year. With Mahathir out of office, Anwar's conviction was overturned in 2004, and he was released. In 2008 Anwar officially returned to politics after a solid victory in a parliamentary by-election.

With relative political stability over the last decades of the 20th century, government and business leaders managed to carry Malaysia into the 21st century with a prosperous, diversified economy. Commodity exports have remained important, however, and certain parts of the country have struggled with severe environmental problems, largely as a result of the exploitation of natural resources. Although development policies have been criticized as lacking ethnic and regional balance, Malaysia nonetheless has achieved considerable success in creating national unity and sociopolitical stability out of deep regional and ethnic divisions.