The roots of Graz can be traced back to Roman times, when a small fort was built where the city centre is today; Slovenians later built a larger fortress in the same place. The name "Graz" is derived from the Slovenian word gradec, which means small castle. Graz was first mentioned with its German name in 1128 when the dukes of Babenberg turned the place into a commercial centre. During 15th century Graz became the capital of Inner Austria (refering to Styria, Carinthia and Carniola) under the Habsburgs.
Graz has a rich history in education manifested by the number of universities in the city. The first university was founded in 1585 (Karl-Franzens-Universität).
Due to its importance as a strategic position, Graz was often assaulted by Ottoman Turks in the 16th century. The fortress located on the Schlossberg (the picture to the right shows the clock tower, which is located on top of the hill) never fell to the Turks (the only place in this region).
During WWII, Graz was part of Nazi Germany (along with rest of Austria). At the end of the war, Graz was surrendered to Soviet troops largely intact; the historic old town was not seriously hit during Allied bombing raids on the city. In 2003 Graz was the Cultural Capital of Europe.
Graz is also known for the Magna Steyr (formerly called Steyr-Daimler-Puch) automobile and truck manufacturing plant located there.
It is also the birthplace (in nearby Thal) of actor and California Governor Arnold Schwarzenegger. Its UPC-Arena was renamed in Schwarzenegger's honor in 1997, but was renamed again in 2005, following controversy over the governor's support of California's death penalty.