Preface

History

Khalaan (the Ebon Heart of Resdayn) was established as sister city and rival to Alma-Ruhn/A-Ruhn or whatever "common" name the Mourning Hold had. Alma-Ruhn (mother city) might be a later retcon for its name.

As it developed over time, it received access to the (new) Inner Sea after the War of the First Council, but eventually started declining as the Mourning Hold rose in importance as the residence of Almalexia. Nevertheless, the Indoril Moraelyn and other members of House Raathim continued ruling the city and its dependants faithfully even during its long decline.

• Ebonheart: A History contains an Imperial scholar's point of view of the early history.
• Ebonheart: A History (Volume One) summarizes the development and decline of Khalaan up until the Armistice and the burning.
• Ebonheart: A History (Volume Two) gives a somewhat unreliable name for the Mourning Hold.

The Armistice

Khalaan was burnt down during the mass-suicide of Indoril retainers following the Armistice. Parts of it were flung into Oblivion due to a pact with an unknown Daedric entity.

The ruined territory was quickly grabbed by the Empire due to its strategic position. Nibenese settlers were the first to arrive and built the new town of Ebonheart, a name chosen to imply continuity with lost Khalaan.

As Morrowind was reorganised into Districts, Ebonheart was turned into a ducal seat due to its favorable position. The city’s territory became the Vvardenfell District as a political statement and as justification for a major harbor directly facing Vivec. Ebon Tower was constructed as a (failed) Tower in imitation of the Imperial City during this time.

Vvardenfell itself was classified as Vvardenfell Territory under the purview of the Temple (garrisoned also by troops of House Redoran), with a ban on new settlements. For centuries, the only existing settlements were the three Great House capitals (Sadrith Mora, Balmora, Ald-Ruhn), pilgrimage sites (Molag Mar, Maar Gan), and Vivec.

• It is public knowledge that Khalaan burnt down and why.
• It is absolutely not known that parts of Khalaan still exist in Oblivion. Even the Daedra who have set up camp there do not want knowledge about it spread.
• The Daedric entity that was involved in these events is very deliberately left vague and mysterious.

• On Morrowind establishes the mindset behind the Indoril reaction to the armistice.
• Ebonheart: A History contains an Imperial scholar's point of view, particularly about the rebuilding.
• Ebonheart: A History (Volume Two) goes into rambling details for the reason of the burning as the author suffers from a severe case of possession.
• In Stendarr Tower Haunting the player needs to deal with the burning ghost of the last Indoril Moraeyln.
• The Khalaan questline.
• Mystery Play of Old Ebonheart is a tradition established in the early years. Spreading the Mystery offers some background information about the play and its roots.
• A short history of Morrowind specifies what conditions Vvardenfell Territory was operating under.

Recent History

In the early 410s, for various reasons, the Empire greatly desired access to the ebony on the island of Vvardenfell.

Over the centuries, a few Telvanni towers had been cropping up near Vvardenfell, but not technically on it. Varus Vanitius, then a lower-ranked legion commander, gambled on this precedence and exploited a loophole in the Armistice: while new settlements on Vvardenfell Territory had been banned, expanding existing ones was technically permitted. 

The new "expansion" of Ebonheart, Hawkmoth Fort and an accompanying harbour, were constructed near Vivec. The following standoff was ultimately won by the Empire. In 414, Vvardenfell Territory was reorganized into the Vvardenfell District and folded into the existing ducal rulership structure.

The position of Duke of Vvardenfell became a lot more powerful all of a sudden. Vedam Dren decided to build a Castle Ebonheart on Vvardenfell, moving (most of) his ducal power and countil there in order to leave the morass of western politics behind. Ebonheart became known as Old Ebonheart as political momentum slowly shifted away from it.

Varus Vanitius, after receiving a long-desired promotion and the title of Knight of the Imperial Dragon, went on to sponsor several more legion settlements, first of all Pelagiad, which housed Legion veterans.

However, the situation on Vvardenfell turned unstable as the Blight slowly encroached and tempers between the new settlers and established inhabitants (settled or Ashlanders) started to rise. In 426, the Blight, a tax revolt in Balmora, and a wave of assassinations (secretly conducted by the Sixth House) enabled Varus Vanitius to try a gamble for full Imperial control over Vvardenfell. The short-lived quarantine failed utterly, however; Vanitius was publicly blamed and shamed, essentially being exiled to the Ebonheart which he created in the first place.

• A short history of Morrowind specifies that Vvardenfell Territory was reorganised into Vvardenfell District.
• The Yellow Book and The Red Book detail the tax revolt in Balmora.
• Dagoth Ur's Plans quantifies the wave of assassinations.
• The Eastern Quarantine is a very recent take on the tax revolt and the quarantine.
• A Blades Document mentions Vedam Dren's current location, Varus Vanitus' likely headspace, and mentions the tax revolts and assassination with a paranoid bent on events.

During TES III: Morrowind

In order to win back support from his superiors, Vanitius has the player assemble several divine artifacts, gambling that all of them together would give him enough clout for a way out of his exile. 

This does not work out as well as he hoped.

See also:

• Varus Vanitius tasks the player with getting two important artefacts.
• Grandmaster Duel involves Varus Vanitius taking one last gamble.