1. Shangjing (Linhuang) was ranked first of five capitals that were established by Liao, all of which served concurrently as regional capitals of a circuit. The other four capitals included Nanjing (Xijin, today's Beijing), Dongjing (Liaoyang), Xijing (Datong) and Zhongjing (Dading, today's Ningcheng).
Almost immediately after its founding, the Liao dynasty began a process of territorial expansion, with Abaoji leading a successful conquest of Balhae. Later emperors would gain the Sixteen Prefectures by fueling a proxy war that led to the collapse of the Later Tang (923–936) and would establish tributary relationships with Goryeo after losing the Goryeo–Khitan Wars. In 1004, the Liao dynasty launched an imperial expedition against the Northern Song dynasty. After heavy fighting and large casualties between the two empires, both sides worked out the Chanyuan Treaty. Through the treaty, the Liao dynasty forced the Northern Song to recognize them as peers and heralded an era of peace and stability between the two powers that lasted approximately 120 years.
Tension between traditional Khitan social and political practices and Chinese influence and customs was a defining feature of the dynasty. This tension led to a series of succession crises; Liao emperors favored the Chinese concept of primogeniture, while much of the rest of the Khitan elite supported the traditional method of succession by the strongest candidate. So different were Khitan and Chinese practices that Abaoji set up two parallel governments. The Northern Administration governed Khitan areas following traditional Khitan practices, while the Southern Administration governed areas with large non-Khitan populations, adopting traditional Chinese governmental practices.
Differences between Chinese and Khitan society included gender roles and marital practices: the Khitans took a more egalitarian view towards gender, in sharp contrast to Chinese cultural practices that segregated men's and women's roles. Khitan women were taught to hunt, managed family property, and held military posts. Many marriages were not arranged, women were not required to be virgins at their first marriage, and women had the right to divorce and remarry.
The Liao dynasty was destroyed by the Jurchen-led Jin dynasty in 1125 with the capture of Emperor Tianzuo of Liao. However, the remnant Khitans, led by Yelü Dashi (Emperor Dezong of Liao), established the Western Liao dynasty (Qara Khitai), which ruled over parts of Central Asia for almost a century before being conquered by the Mongols. Although cultural achievements associated with the Liao dynasty are considerable, and a number of various statuary and other artifacts exist in museums and other collections, major questions remain over the exact nature and extent of the influence of the Liao Khitan culture upon subsequent developments, such as the musical and theatrical arts.
In 1124, the successor state established by Yelü Dashi in the Western Regions also officially adopted the dynastic name "Great Liao". In historiography, however, this regime is more commonly called the "Western Liao" or "Qara Khitai".
There is no consensus among historians regarding the etymology of "Liao". Some believe that "Liao" was derived from the word for "iron" in the Khitan language, while others believe that the name came from the Liao River which was the traditional homeland of the Khitan people.