Pereslavl-Zalessky was founded in 1157 by Prince Yuri Dolgoruky, son of Vladimir Monomakh, the Grand Prince of Kiev. Yuri was given control over the northeastern outpost of what was then Kievan Rus' (the early predecessor of modern-day Russia and Ukraine), and Pereslavl-Zalessky served two very important functions. The first was political: Yuri sought to draw parallels between the power base he was building in the Rus' region and the center of power in Kiev, to the southeast. So he named this town Pereyaslavl (meaning "to achieve glory"; the "ya" was later dropped) after a town outside of Kiev, and he named the river alongside the town Trubezh, just as in the Kievan Pereyaslavl. The "Zalessky" appellation, added in the 15th century, means "beyond the forests" and was used to distinguish the town from many other Pereyaslavls (not least the one near Kiev).

The second reason was economic. The location of the town on the southern shore of Lake Pleshcheyevo was ideal for defending the western approaches to vital trade routes along the Nerl River to the Klyazma, Oka, and Volga rivers. The topography only accentuates this role. From the hills, the impressive Danilovsky and Goritsky monasteries peer down on the low wooden and stone buildings of the town.

As the birthplace of Alexander Nevsky (1220–63), Pereslavl-Zalessky has yet another claim to fame. Nevsky entered the pantheon of Russia's great heroes when, as Prince of Novgorod, he beat back invading Swedes in 1240 at the Battle of the Neva (thus his last name). For his victory, the Mongol Khan awarded Nevsky the title of Grand Prince of Vladimir. There's a small church in town honoring Nevsky.

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