Bhutan’s early history remains rather sketchy for want of proper records. Whatever was recorded was done in scriptures that was destroyed by fire and other natural disasters. Thus much of Bhutan’s history draws from reports and personal diaries of British explorers and political officers, and legends and myths and folklore. Many early inhabitants of Bhutan were followers of Bon, the animistic tradition prevalent throughout the Himalayan region before the arrival of Buddhism. Buddhism was first introduced to Bhutan in the 7th century AD by Guru Padmasambhava aka Guru Rinpoche, a tantric master. He is supposed to have come to Taktsang in Paro riding a tigress. In fact, that’s how the most spectacular Taktsang Monastery came to be called the Tiger’s Nest. The Kurjey Lhakhang in Bumthang is another site where Guru Rinpoche meditated. Most Bhutanese historians, however, give Lama Phajo Drukgom Shigpo (1184–1251) the credit of establishing the Bhutanese form of Buddhism – the Drukpa Kagyu School. Lama Drukpa Kunley, the Divine Madman, visited Bhutan in the 15th century and established Chime Lhakhang in Punakha.

Between the 11th and 16th centuries numerous terma (sacred texts) hidden by Guru Rinpoche were discovered by tantric lamas called tertons. Terton Pema Lingpa discovered his first terma from the lake of Membartsho near Bumthang in 1475. While Bumthang is today considered the cultural heartland of Bhutan, Terton Pema Lingpa is considered a major figure in Bhutanese history.

In 1616, Bhutan received its founder father – Zhabdrung Ngawang Namgyel (1594–1651). It was he who started the system of dzongs in Bhutan with the building of the first dzong in Simtokha, south of Thimphu. Today, all 20 districts have dzongs that serve as administrative headquarters and house the monastic body.

Zhabdrung Ngawang Namgyal fought several Tibetan invasions and local uprisings to consolidate the country. He established the first sangha (community of monks) at Cheri Gonpa near Thimphu. When Punakha Dzong was completed in 1635, the sangha was moved there and became the dratshang (central monk body), headed by a supreme abbot called the Je Khenpo.

It was the Zhabdrung who codified the Kagyu religious teachings into a system that was distinctively Bhutanese. He also defined the national dress and instituted the tsechu festival. He developed the first tax system and instituted the compulsory labor system to build dzongs, temples, and bridges. The Zhabdrung created the system of Choesi, the dual system of governance, where the religious and spiritual aspects of the country were handled by a chief abbot (called the Je Khenpo) and the political aspects were handled by a secular ruler (called the desi). Zhabdrung Ngawang Namgyal went into retreat in Punakha Dzong in 1651. He didn’t emerge again, and is believed he passed away during the retreat. His death was concealed until 1705 for the fear of internal unrest and invasions from Tibet.

Nevertheless, the next 200 years were a time of civil war, internal conflicts and political infighting. In between the Bhutanese fought several wars with the people of Cooch Behar and the British India. The first encounter took place in December 1772 after which the British-Bhutan encounters took place every now and then. The political intrigue and civil wars continued in Bhutan, and there were numerous skirmishes over boundaries and trading rights. However, the Trongsa penlop, Jigme Namgyal (1825–82), eventually consolidated and established effective control of the country. After losing a major battle and ceding the southern plains (called duars) to the British in 1865, the Bhutanese signed the treaty of Sinchula. When he retired as 51st desi, Jigme Namgyal remained in firm control of the country and in 1879 appointed his 17-year-old son, Ugyen Wangchuck, as Paro penlop. After Jigme Namgyal died, his son consolidated his own position and developed closer relations with the British. In 1907, Ugyen Wangchuck was elected the hereditary ruler of Bhutan. He was crowned on 17 December 1907 and installed as head of state with the title Druk Gyalpo (Dragon King).

Ugyen Wangchuck died in 1926 and was succeeded by his 24-year-old son, Jigme Wangchuck. The second king refined the administrative and taxation systems and brought the entire country under his direct control. After India gained independence on 15 August 1947, the new Indian government recognized Bhutan as an independent country. In 1949, Bhutan signed a treaty with independent India that was very similar to their earlier treaty which the British signed in 1910. The treaty reinforced Bhutan’s position as a sovereign state. King Jigme Wangchuck was succeeded by his son, Jigme Dorji Wangchuck, after the former’s death in 1952. The third king was educated in India and England. He invited the Indian prime minister, Jawaharlal Nehru, and his daughter, Indira Gandhi, to visit Bhutan in 1958. In 1961 Bhutan emerged from centuries of self-imposed isolation and embarked on a process of planned development. Bhutan joined the Colombo Plan in 1962. The first five-year plan for development was implemented in 1961. Bhutan joined the Universal Postal Union in 1969 and became a member of the UN in 1971. In the same year, Bhutan and India established formal diplomatic relations and exchanged ambassadors.

In 1953, King Jigme Dorji Wangchuck established the National Assembly. He abolished serfdom, reorganized land holdings, created the Royal Bhutan Army and police force, and established the High Court. King Jigme Dorji Wangchuck died in 1972 at 44. He was succeeded by his 16-year-old son, Jigme Singye Wangchuck. Like his father, he was educated in India and England, but he also received a Bhutanese education at the Ugyen Wangchuck Academy in Paro. He pledged to continue his father’s program of modernization and announced a plan for the country to achieve economic self-reliance. Among the development goals set by the king was the ideal of economic self-reliance, what he called Gross National Happiness (GNH). GNH has today gained universal currency and Bhutan at the moment is researching and developing indices on how to measure the successes of various development projects based on GNH indicators.
King Jigme Singye Wangchuck is the architect of Bhutan’s policy of environmental conservation. In 2005, the 49-year-old king announced his plan to abdicate the throne in favor of his eldest son, Crown Prince Jigme Khesar Namgyel Wangchuck, and help move the country from monarchy to a democratic constitutional monarchy. Bhutan held the first democratic elections in March 2008. The country went elected its fourth Parliament in January 2024.