British colonisation of Malaya , as Malaysia was then known, began in 1786 when Francis Light occupied Penang and founded Georgetown . Four years later they took Province Wellesley. From then onwards more states became British protectorates. During the Second World War, between 1942 and 1945 Japan occupied Malaysia . In 1948, the British-ruled territories on the Malay Peninsula formed the Federation of Malaya, which became independent in 1957. Malaysia was formed in 1963 when the former British colonies of Singapore and the East Malaysian states of Sabah and Sarawak on the northern coast of Borneo joined the Federation. Singapore ceded from the Federation in 1965.

Slightly larger than New Mexico , Malaysia lies on the Malay Peninsula in Southeast Asia . The nation also includes Sabah and Sarawak on the island of Borneo to the east. Most of Malaysia is covered by forest, with a mountain range running the length of the peninsula. The highest mountain is Mount Kinabalu at 4,095.2 metres (13,435.7 ft) on the island of Borneo . Extensive forests provide ebony, sandalwood, teak, and other woods. Tanjung Piai, located in the southern state of Johor, is the southernmost tip of continental Asia . The Straits of Malacca, lying between Sumatra and West Malaysia , is arguably the most important shipping lane in the world. Putrajaya is the newly created administrative capital for the federal government of Malaysia , aimed in part to ease growing congestion within Malaysia 's capital city, Kuala Lumpur . Kuala Lumpur remains the seat of parliament, as well as the commercial and financial capital of the country. Other major cities include George Town , Ipoh , Johor Bahru and Kuching.

Malaysia transformed itself, between 1971 and the late 1990s from a producer of raw materials into an emerging multi-sector economy. Growth was almost exclusively driven by exports - particularly of electronics. As a result, Malaysia was hard hit by the global economic downturn and the slump in the information technology sector in 2001 and 2002. GDP in 2001 grew only 0.5% because of an estimated 11% contraction in exports, but a substantial fiscal stimulus package equal to US$1.9 billion mitigated the worst of the recession, and the economy rebounded in 2002 with a 4.1% increase. The economy grew 4.9% in 2003, notwithstanding a difficult first half, when external pressures from Severe Acute Respiratory Syndrome (SARS) and the Iraq War led to caution in the business community. Growth topped 7% in 2004 and 5% in 2005. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the cost of government subsidies for domestic gasoline and diesel fuel has risen and offset some of the benefit. Malaysia "unpegged" the ringgit from the US dollar in 2005, but so far there has been little movement in the exchange rate. Healthy foreign exchange reserves, low inflation, and a small external debt are all strengths that make it unlikely that Malaysia will experience a financial crisis over the near term similar to the one in 1997. The economy remains dependent on continued growth in the US, China, and Japan - top export destinations and key sources of foreign investment.

The ancestors of the people that now inhabit the Malaysian peninsula first migrated to the area between 2500 and 1500 BC. Those living in the coastal regions had early contact with Chinese and Indians; seafaring traders from India brought with them Hinduism. As Muslims conquered India, Islam spread to Malaysia. In the 15th century AD, Islam acquired a firm hold on the region when the Hindu ruler of the powerful city-state of Malacca, Parameswara Dewa Shah, converted to Islam. British and Dutch interest in the region grew in the 1800s, with the British East India Company establishment of a trading settlement on the island of Singapore. Trade soared. In the 1880s, Britain formally established protectorates in Malaysia. With the At about the same time, rubber trees were introduced from Brazil. With the mass production of automobiles, rubber became a valuable export, and laborers were brought in from India to work the rubber plantations. Likewise waves of Chinese immigrants started arriving with the opening up of tin mines in the 1820s. Following the Japanese occupation of Malaysia during World War II, a growing nationalist movement prompted the British to establish the semiautonomous Federation of Malaya in 1948. But Communist guerrillas took to the jungles to begin a war of national liberation against the British, who declared a state of emergency to quell the insurgency, which lasted until 1960. The independent state of Malaysia came into existence on Sept. 16, 1963, as a federation of Malaya, Singapore, Sabah (North Borneo), and Sarawak. In 1965, Singapore withdrew from the federation to become a separate nation. Since 1966, the 11 states of former Malaya have been known as West Malaysia, and Sabah and Sarawak have been known as East Malaysia.
In the 1980s, Dr. Mahathir Mohamad succeeded Hussein Onn as prime minister. Dr Mahathir instituted economic reforms that would transform Malaysia into one of the so-called Asian Tigers. Throughout the 1990s, Dr Mahathir embarked on a massive project to build a new capital from scratch in an attempt to bypass congested Kuala Lumpur. Beginning in 1997 and continuing through the next year, Malaysia suffered from the Asian currency crisis. Instead of following the economic prescriptions of the International Monetary Fund and World Bank, the then prime minister opted for fixed exchange rates and capital controls. In late 1999, Malaysia was on the road to economic recovery.

Capital	Kuala Lumpur note: Putrajaya is the administrative capital; Parliament meets in Kuala Lumpur
Location	Southeastern Asia , peninsula bordering Thailand and northern one-third of the island of Borneo , bordering Indonesia , Brunei , and the South China Sea , south of Vietnam
Population	24,385,858
Ethnicity	Malay 50.4%, Chinese 23.7%, Indigenous 11%, Indian 7.1%, others 7.8%
Religions	Muslim, Buddhist, Christian, Daoist, Hindu, Sikh;
Languages	Bahasa Melayu (official), English, Chinese (Cantonese, Mandarin, Hokkien, Hakka, Hainan , Foochow ), Tamil, Telugu, Malayalam, Panjabi, Thai note: in East Malaysia there are several indigenous languages; most widely spoken are Iban and Kadazan
Independence Day	August 31, 1957 (from UK )
Government	constitutional monarchy
Head of State	His Majesty Seri Paduka Baginda The Yang Di-Pertuan Agong Al-Sultan Abdullah Ri'ayatuddin Al-Mustafa Billah Shah Ibni Almarhum Sultan Haji Ahmad Shah Al-Musta'in Billah
Head of Government	The Hon. Dato' Seri Anwar Bin Ibrahim
Legal System	Based on English common law; judicial review of legislative acts in the Supreme Court at request of supreme head of the federation; has not accepted compulsory ICJ jurisdiction; Islamic law or Syariah is applied to Muslims in matters of family law
Currency	Ringgit (MYR)
Natural resources	Tin, petroleum, timber, copper, iron ore, natural gas, bauxite
Agricultural Products	Peninsular Malaysia - rubber, palm oil, cocoa, rice; Sabah - subsistence crops, rubber, timber, coconuts, rice; Sarawak - rubber, pepper, timber
Industries	Peninsular Malaysia - rubber and oil palm processing and manufacturing, light manufacturing industry, electronics, tin mining and smelting, logging, timber processing; Sabah - logging, petroleum production; Sarawak - agriculture processing, petroleum production and refining, logging
Major trading partners	US, Singapore , Japan, China , Hong Kong , Thailand , South Korea , Germany

Prime Minister's Office in Putrajaya

Floating Mosque in Kuala Terengganu

Sultan Abdul Samad Building in Kuala Lumpur houses the High Court of Malaya at Kuala Lumpur and the Trade Court. Kuala Lumpur was the capital of the Federated Malay States and is the current Malaysian capital.