In this originally uninhabited area (the ager vaticanus) on the opposite side of the Tiber from the city of Rome, Agrippina the Elder (14 BC – 18 October AD 33) drained the hill and environs and built her gardens in the early 1st century AD. Emperor Caligula (37-41) started construction of a circus (40) that was later completed by Nero, the Circus Gaii et Neronis, usually called, simply, the Circus of Nero. The Vatican obelisk was originally taken by Caligula from Heliopolis, Egypt to decorate the spina of his circus and is thus its last visible remnant.
This area became the site of martyrdom of many Christians after the great fire of Rome in 64. Ancient tradition holds that it was in this circus that Saint Peter was crucified upside down. Opposite the circus was a cemetery separated by the Via Cornelia.
Funeral monuments and mausoleums and small tombs as well as altars to pagan gods of all kinds of polytheistic religions were constructed lasting until before the construction of the Constantinian Basilica of St. Peter's in the first half of the 4th century. Remains of this ancient necropolis were brought to light sporadically during renovations by various popes throughout the centuries increasing in frequency during the Renaissance until it was systematically excavated by orders of Pope Pius XII from 1939 to 1941.
In 326, the first church, the Constantinian basilica, was built over the site that Roman Catholic apologists as well as noted Italian archaeologists argue was the tomb of Saint Peter, buried in a common cemetery on the spot. From then on the area started to become more populated, but mostly only by dwelling houses connected with the activity of St. Peter's.
A palace was constructed near the site of the basilica as early as the 5th century during the pontificate of Pope Symmachus (pope 498-514). Popes in their secular role gradually came to govern neighbouring regions and, through the Papal States, ruled a large portion of the Italian peninsula for more than a thousand years until the mid 19th century, when all of the territory of the Papal States was seized by the newly created Kingdom of Italy. For much of this time the Vatican was not the habitual residence of the Popes, but rather the Lateran Palace, and in recent centuries, the Quirinal Palace, while the residence from 1309-1377 was at Avignon in France.