Swedish Estonia was established despite constant invasion from Russia, and Frederick II of Denmark-Norway bought the old Bishopric of Ösel–Wiek, which he placed under the control of his brother Magnus of Holstein.

In 1576, Stephen Báthory became King of Poland as well as Grand Duke of Lithuania and turned the tide of the war with his successes between 1578 and 1581, including the joint Swedish–Polish–Lithuanian offensive at the Battle of Wenden.

[5] As war approached, Livonia had a weak administration subject to internal rivalries, lacked any powerful defences or outside support, and was surrounded by monarchies pursuing expansionist policies.

Frost notes of the volatile region: "Racked with internal bickering and threatened by the political machinations of its neighbours, Livonia was in no state to resist an attack.

[12] A long bar of Danish territories in the south and lack of sufficient year-round ice-free ports severely limited Sweden's access to Baltic trade.

[15] Nevertheless, the country prospered due to exports of timber, iron, and most notably copper, coupled with the advantages of a growing navy[15] and proximity to the Livonian ports across the narrow Gulf of Finland.

[15] Through its absorption of the principalities of Novgorod (1478) and Pskov (1510),[17] the Tsardom of Russia had become Livonia's eastern neighbour and grown stronger after annexing the khanates of Kazan (1552) and Astrakhan (1556).

The new Ivangorod port – built in 1550 during the reign of Tsar Ivan IV on the eastern shore of the Narva River – was considered unsatisfactory on account of its shallow waters.

[18] He aimed to establish a corridor between the Baltic and the new territories on the Caspian Sea, because if Russia were to engage in open conflict with major western powers, it would need imports of more sophisticated weaponry.

Among his few Livonian supporters was landmarschall Jasper von Munster, with whom he planned an April 1556 attack on his opponents that would involve military aid from both Sigismund and Albert.

This resulted in a diplomatic mission to petition for their release being dispatched by the Pomeranian dukes, the Danish King,[22] Emperor Ferdinand I, and the estates of the Holy Roman Empire.

[35] Russian successes followed similar patterns featuring a multitude of small campaigns, with sieges where musketmen played a key role in destroying wooden defences with effective artillery support.

[30] The Tsar's forces took important fortresses like Fellin (Viljandi), yet lacked the means to gain the major cities of Riga, Reval (Tallinn), or Pernau (Pärnu).

This helped to precipitate the Northern Seven Years' War[44] since in 1561, Frederick II had already protested against Swedish presence in Reval (Tallinn), claiming historical rights relating to Danish Estonia.

[40] When Eric XIV's forces seized Pernau (Pärnu) in June 1562, his diplomats tried to arrange Swedish protection for Riga, which brought him into conflict with Sigismund.

[53] The defeats of Ula and Czasniki, along with the defection of Andrey Kurbsky, led Ivan IV to move his capital to the Alexandrov Kremlin while the perceived opposition against him was repressed by his oprichniki.

[55] The transfer of Riga, and the surrounding entrance to the River Dvina, troubled the Lithuanians, since much of their trade depended on safe passage through it and they had already built fortifications to protect it.

No agreement was forthcoming and a ten-day break was taken in negotiations, during which time various Russian meetings were held (including the zemsky sobor, the Assembly of the Land) to discuss the issues at stake.

[55] Within the Assembly, the church's representative stressed the need to "keep" Riga (though it had not yet been conquered),[56] while the Boyars were less keen on an overall peace with Lithuania, noting the danger posed by a joint Polish-Lithuanian state.

[58] According to Juusten, at the meeting the Russians demanded the Swedes to abandon their claim to Reval (Tallinn), provide two or three hundred cavalry when required, pay 10,000 thaler in direct compensation, surrender Finnish silver mines near the border with Russia, and allow the Tsar to style himself "Lord of Sweden".

The Russian advance concluded with the sacking of Weissenstein (Paide) in 1573, where, after its capture, the occupying forces roasted some of the leaders of the Swedish garrison alive, including the commander.

[74] Ivan's attention was focused elsewhere, while Frederick's reluctance perhaps stemmed from a new spirit of Swedish–Danish unity that made him unwilling to invade Livonia on behalf of Magnus, whose state was a vassal of Russia.

[79] In 1576, the Transylvanian prince Stephen Báthory became King of Poland and Grand Duke of Lithuania after a contested election to the joint Polish–Lithuanian throne with the Habsburg Emperor Maximilian II.

[85] Both Báthory's fiancée Anna Jagiellon and Maximilian II had been proclaimed elected to the same throne in December 1575, three days apart;[85] Maximilan's death in October 1576 prevented the conflict from escalating.

[91] Báthory then appointed a close ally and powerful member of his court, Jan Zamoyski, to lead a force of 48,000, including 25,000 men from Lithuania, against the fortress of Velikie Luki which he went on to capture on 5 September 1580.

However, financial support from the Polish parliament was dropping, and Báthory failed to lure Russian forces in Livonia out into open field before the onset of winter.

[93] The towns of Kexholm and Padise were taken by Swedish forces in 1580,[93] then in 1581, concurrent with the fall of Wesenberg, a mercenary army hired by Sweden recaptured the strategic city of Narva.

[97] The post-war Duchy of Courland and Semigallia south of the Düna (Daugava) river experienced a period of political stability based on the 1561 Treaty of Vilnius, later modified by the 1617 Formula regiminis and Statuta Curlandiæ, which granted indigenous nobles additional rights at the duke's expense.

[107][106] During the later Ingrian War, Charles' successor Gustavus Adolphus retook Ingria and Kexholm which were formally ceded to Sweden under the 1617 Treaty of Stolbovo[106] along with the bulk of the Duchy of Livonia.

In 1617, when Sweden had recovered from the Kalmar War with Denmark, several Livonian towns were captured, but only Pernau (Pärnu) remained under Swedish control after a Polish–Lithuanian counter-offensive.