According to the archaeological finds, the settlement of the Aegean islands did not take place in all the islands at once. Their distance from the nearest land, the size, geomorphology, climate and the available resources constitute factors that attract or deter the habitation of the islands. The archaeological finds from Melos indicate that the human presence in the Aegean island dates to the Upper Palaeolithic (11th millenium BC) and is associated with the extraction of obsidian for the manufacture of sharp tools. Traces of a more permanent settlement are detected from the Middle Stone Age (9000-6800 BC) in the Cyclops Cave on Yioura of the northern Sporades and in Maroulas on Kythnos. The systematic settlement of the islands occurs in the Early Neolithic (6500-5800 BC) in the Dodecanese, but in most islands it takes place during the Late (4800-4500 BC) or the Final Neolithic (4500-3200 BC). The development of navigation and the quest for durable raw materials such as obsidian and metals, gave an impetus to the settlement of the islands. Their use marked the economy of the agrarian communities of the Neolithic Aegean.

During the Early Bronze Age (3rd millenium BC), populous, fortified settlements with clear town planning, communal buildings and other works of public interest, specialization and labour division, economic prosperity and accumulation of wealth are developed on the coasts of large islands of the north and eastern Aegean, consisting the earliest centres of an early urban character in the Aegean. In the Cyclades, small coastal settlements are founded during the Early Cycladic I and II periods while the larger islands comprise small settlements as well. During the transitional stage Lefkandi I- Kastri the settlements are situated on craggy coastal hills or on high sites far from the coast. Many are fortified, suggesting probable population movements from the islands of the north Aegean to the Cyclades. At the end of the Early Cycladic period the settlement pattern of many small settlements is abandoned and the inhabitants of the islands are concentrated in one or two larger and better organized settlements which will evolve into large, densely structured and fortified towns in the Middle Cycladic and Late Cycladic period and will experience economic prosperity because of the cooperation with the economic power of the first half of the 2nd millenium BC in the Aegean: Minoan Crete.

At the end of the Middle Cycladic and in the beginning of the Late Cycladic period the most important towns of the Cyclades (Agia Irini, Phylakopi, Akrotiri) are hit by natural disasters and in the Late Cycladic I, they are rebuilt with manifest signs of Minoan architecture (masonry, frescoes). After the eruption of the Theran volcano in 1628 BC, Agia Irini and Phylakopi remain the main urban centres of the Cyclades, having however received influence from Mycenaean Greece as well (fortifications, sanctuaries, megara). During the early period of the Late Cycladic III, the Mycenaean presence in the islands is determinative and clear in both existent and newly founded settlements, in desolated Thera (Monolithos) as well as in the rest of the Cycladic islands. Toward the middle of the Late Cycladic period, the existent fortification walls are extended whereas the new settlements are founded in naturally fortified sites (Koukounaries, Agios Andreas). After the period of affluence (late phase of Late Cycladic III), the flourishing Cycladic settlements are abandoned (Phylakopi, Koukounaries) or decline (Agia Irini) and gradually, until the end of the 10th century, they disappear. At the end of the Late Bronze Age, the Mycenaean presence is strong not only on the Cyclades but also on eastern Aegean islands (Chios) and south Aegean ones (Kos, Rhodes). In fact, after the collapse of the great Mycenaean centres (approximately 1200 BC) population movement occurs from Mycenaean Greece to these islands, resulting in the increase of population and the favouring of the economic development of the islands (Ialysos on Rhodes).

Poliochni, Yellow period. View of megaron 605
and of the dependencies 604-609.

Thera, Akrotiri. View of the West House.