The hill of Phaistos was inhabited as early as the Final Neolithic period (4500 – 3200 BC), when an extensive Neolithic settlement was established, succeeded by a settlement of the Prepalatial Period (3200 – 4900 BC). These early settlements were followed by the foundation of the First Palace of Phaistos (1900- 1700 BC), which was built on the NE part of the hill in order to control the whole of the fertile plain of the Messara.

Phaistos (also spelled: Phaestos, and Festos) was one of the most important centers of Minoan civilization, and the most wealthy and powerful city in southern Crete. The extensive city of Phaistos arose around this palace in the Minoan period, and continued to flourish until Hellenistic times (323-67 BC).
The Minoan city covered a considerable area around the palatial center.

Following the destruction of the palace in the 15th century BC by an earthquake, the city continued to be inhabited in the Mycenaean and Geometric periods, that is, until the 8th-century BC. The exact location of the palace of Phaistos was first determined in the middle of the 19th century 

Although many inscriptions were found by the archaeologists, in Linear A code which is still undeciphered, all we know about the site – and even its name – is based on the ancient writers and findings from Knossos.
According to mythology, Phaistos was the seat of king Rhadamanthys, brother of king Minos. It was also the city that gave birth to the great wise man and soothsayer Epimenides, one of the seven wise men of the ancient Hellenic world.

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