The origins of the Albanian people are not definitely known, but most data drawn from history and from linguistic, archaeological, and anthropological studies have led to the conclusion that Albanians are the descendants of the ancient Illyrians. Similarly, the Albanian language derives from the language of the Illyrians, the transition from Illyrian to Albanian apparently occurring between the 4th and 6th centuries AD. 

Illyrian culture is believed to have evolved from the Stone Age and to have manifested itself in the territory of Albania toward the beginning of the Bronze Age, about 2000 BC. The Illyrians were not a uniform body of people but a conglomeration of many tribes that inhabited the western part of the Balkans, from what is now Slovenia, including the region of Epirus, which extends about halfway down the mainland of modern Greece.  In general, Illyrians in the highlands of Albania were more isolated than those in the lowlands, and their culture evolved more slowly—a distinction that persisted throughout Albania’s history.

Authors of antiquity relate that the Illyrians were a sociable and hospitable people, renowned for their daring and bravery at war. Illyrian women were fairly equal in status to the men, even to the point of becoming heads of tribal federations. In matters of religion, Illyrians were pagans who believed in an afterlife and buried their dead along with arms and various articles intended for personal use.

In the 4th century Illyrians faced a threat from the growing power of the Romans. Seeing Illyrian territory as a bridgehead for conquests east of the Adriatic, Rome in 229 BC attacked and defeated the Illyrians, led by Queen Teuta, and by 168 BC had established effective control over Illyria.

The territory now known as Albania remained under Roman (Byzantine) control until the Slavs began to overrun it from 548 and onward, and was captured by Bulgarian Empire in the 9th century.  In general, the invaders destroyed or weakened Roman and Byzantine cultural centers in the lands that would become Albania.

The territorial nucleus of the Albanian state formed in the Middle Ages, as the Principality of Arbër , the first Albanian state during the Middle Ages . it was established by archon Progon in the region of Kruja, in ca 1190. Progon, the founder, was succeeded by his sons Gjin and Demetrius. The Principality was dissolved in 1255. 

At the dawn of the establishment of the Ottoman Empire in Southeast Europe, the geopolitical landscape was marked by scattered kingdoms of small principalities. The Ottomans erected their garrisons throughout southern Albania by 1415 and occupied most of Albania by 1431. However, in 1443 a great and longstanding revolt broke out under the lead of the Albanian national hero Skanderbeg, which lasted until 1479, many times defeating major Ottoman armies led by the sultans Murad II and Mehmed II. Skanderbeg united initially the Albanian princes, and later on established a centralized authority over most of the non-conquered territories, becoming the ruling Lord of Albania. He also tried relentlessly but rather unsuccessfully to create a European coalition against the Ottomans. He thwarted every attempt by the Turks to regain Albania, which they envisioned as a springboard for the invasion of Italy and western Europe. His unequal fight against the mightiest power of the time won the esteem of Europe as well as some support in the form of money and military aid from Naples, the Papacy, Venice, and Ragusa.

With the arrival of the Turks, Islam was introduced in Albania as a third religion. This conversion caused a massive emigration of Albanians to the Christian European countries. Along with the Bosniaks, Muslim Albanians occupied an outstanding position in the Ottoman Empire, and were the main pillars of Ottoman Porte's policy in the Balkans. Enjoying this privileged position in the empire, Muslim Albanians held various high administrative positions, with over two dozen Grand Viziers (similar to a prime minister) of Albanian origin.

In the 15th century, when the Ottomans were gaining a firm foothold in the region, Albanian towns were organised into four principal sanjaks (administrative regions). Albania remained under Ottoman control as part of the Rumelia province until 1912, when independent Albania was declared.

A Pan-Albanian Congress was held in Vlorë on 28 November 1912 that constituted the Assembly of Vlorë that declared Albania an independent country and set up a provisional government. 

The Provisional Government of Albania was established on the second session of the assembly held on 4 December 1912. It was a government of ten members, led by Ismail Qemali, considered among Albanians as the Father of the Nation. Albania's independence was recognized by the Conference of London on 29 July 1913, but the drawing of the borders of the newly established State of Albania, ignored the demographic realities of the time letting more than the half of the territories and population, outside of the new Albanian state. 

Ismail Qemali, was forced to resign on 22 January 1914 and the The International Commission of Control directed by the Great Powers, recognized the independence of Albania in the Treaty of London on May, 1913. The Principality was established on February 21, 1914. Albania had been under Ottoman rule from around 1478. The Great Powers selected the german Prince, William of Wied, a nephew of Queen Elisabeth of Romania to become the sovereign of the newly independent Albania.

In November 1913 the Albanian pro-Ottoman forces had offered the throne of Albania to the Ottoman war minister of Albanian origin, Izzet Pasha.  The pro-Ottoman peasants believed that the new regime of the Principality of Albania wash a tool of the six Christian Great Powers.

The revolt of Albanian peasants against the new Albanian regime erupted under the leadership of the group of Muslim clerics gathered around Haxhi Qamili, who proclaimed himself the savior of Albania and Islam. The regime of Prince of Wied collapsed and he left the country on 3 September 1914.

The short-lived monarchy (1914–1925) was succeeded by an even shorter-lived first Albanian Republic (1925–1928), to be replaced by another monarchy (1928–1939). The kingdom was supported by the fascist regime in Italy and the two countries maintained close relations until Italy's sudden invasion of the country in 1939. Albania was occupied by Fascist Italy and then by Nazi Germany during World War II.

After being militarily occupied by Italy, from 1939 until 1943 the Albanian Kingdom was a protectorate and a dependency of Italy governed by the Italian King Victor Emmanuel III and his government. After the Axis' invasion of Yugoslavia in April 1941 and after the capitulation of Italy in 1943, Nazi Germany occupied Albania too. This was the time when the Communist Party of Albania was founded.

By the end of World War II, the country became a Communist state, the People's Republic of Albania (renamed "the People's Socialist Republic of Albania" in 1976), which was led by Enver Hoxha and the Labour Party of Albania. The main military and political force in the country, the communist party, sent forces to northern Albania against the nationalists to eliminate its rivals. This event was the starting point of many other issues which took place during Enver Hoxha's dictatorship. Class struggle was strictly applied, human freedom and human rights were denied. 

The socialist reconstruction of Albania was launched immediately after the annulling of the monarchy and the establishment of a "People's Republic". In 1947, Albania's first railway line was completed, with the second completed eight months later. New land reform laws were passed granting the land to the workers and peasants who tilled it. Agriculture became cooperative, and production increased significantly, leading to Albania's becoming agriculturally self-sufficient. By 1955, illiteracy was eliminated among Albania's adult population. During this period Albania became industrialized and saw rapid economic growth, as well as unprecedented progress in the areas of education and health. The average annual rate of Albania's national income was 29% higher than the world average and 56% higher than the European average. Albania's Communist constitution did not allow taxes on individuals; instead, taxes were imposed on cooperatives and other organizations, with much the same effect.

Religious freedoms were severely curtailed during the Communist period, with all forms of worship being outlawed. Many clerics, priests and imams were arrested, tortured and executed. In 1967 Hoxha proclaimed Albania the 'world's first atheist state'. Hundreds of mosques and dozens of Islamic libraries — containing priceless manuscripts — were destroyed. Churches were not spared either, and many were converted into cultural centers for young people. Nonetheless, many Albanians continued to practice their belief secretly.

Hoxha's political successor Ramiz Alia oversaw the dismemberment of the "Hoxhaist" state during the breakup of the Eastern Bloc in the later 1980s.

After protests beginning in 1989 and reforms made by the communist government in 1990, the People's Republic was dissolved in 1991-92 and the Republic of Albania was founded. March 1992, amid liberalization policies resulting in economic collapse and social unrest, a new front led by the new Democratic Party took power. In the following years, much of the accumulated wealth of the country was invested in a number of Ponzi pyramid banking schemes, which were widely supported by government officials. The schemes began to collapse in late 1996, leading many of the investors into initially peaceful protests again the government, requesting their money back. The protests turned violent in February as government forces responded with fire, and in March the police and Republican Guard deserted, leaving their armories open.  The crisis led the Prime Minister to resign on 11 March 1997, followed by the President in July in the wake of the June General Election. The Socialist Party won the elections in 1997, and a degree of political stabilization followed. In 1999, the country was affected by the Kosovo War, when a great number of Albanians from Kosovo found refuge in Albania.

Albania became a full member of NATO in 2009, and has applied to join the European Union and in June 2014, the Republic of Albania became an official candidate for accession to the European Union.