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The Reformation reached Livonia in the 1520s. The Livonian Confederation was weakened while its Eastern neighbor Muscovy had grown stronger after defeating the Muslim khanates of Kazan and Astrakhan in the 1550s.
The Russian tsar Ivan the Terrible demanded that Livonian Confederation pay huges taxes (40,000 talers) for the Bishopric of Dorpat. The dispute ended with a Russian invasion in 1558. Russian troops occupied Dorpat and Narva. The goal of the Russian tsar was to take control of the lucrative Baltic Sea trade.
That went against the interests of other countries. Erik XIV of Sweden and Frederick II of Denmark sent troops to help protect Livonia. The weakened Order of Livonia submitted Livonia to the protection of Poland in 1561. The last Master of the Order of Livonia, Gotthard Kettler, became the first ruler of the Polish vassal state Duchy of Courland.
The Livonian Confederation collapsed; but Russia found itself in wars (the Livonian War) with the more powerful kingdoms of Poland and Sweden. In 1562 full scale war erupted between Russia and Poland. In 1575 the Russians occupied Pernau in Western Estonia.
In 1561, the city council of Reval in Estonia surrendered to Sweden. Reval became the staging point for further Swedish conquests. In 1575 Swedes lost the fortress of Weissenstein (Paide) to the Russians but in 1581 a mercenary army of Sweden under Pontus de la Gardie captured the strategic city of Narva from Russia. Sweden had established its sovereignty over mainland Estonia, while Ösel became Danish territory. Livonia and Courland remained under the control of Poland.
In 1582, the peace Treaty of Jam Zapolski was signed between Russia and Poland with Russia ceding Livonia to Poland. In 1583 Russia also made peace with Sweden. Under the Treaty of Plussa, Russia lost Narva, and towns south of the Finnish Bay, to Sweden.
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