Once home to fishermen and farmers, modern Hong Kong is a teeming, commercially-vibrant metropolis where Chinese and Western influences fuse.
The former British colony became a special administrative region of China in 1997, when Britain's 99-year lease of the New Territories, north of Hong Kong island, expired.
Hong Kong is governed under the principle of "one country, two systems", under which China has agreed to give the region a high degree of autonomy and to preserve its economic and social systems for 50 years from the date of the handover.
Hong Kong's constitution, the Basic Law, provides for the development of democratic processes. However, Beijing can veto changes to the political system and pro-democracy forces have been frustrated by what they see as the slow pace of political reform.
China controls Hong Kong's foreign and defence policies, but the territory has its own currency and customs status.
Hong Kong's economy has moved away from manufacturing and is now services-based. The region is a major corporate and banking centre as well as a conduit for China's burgeoning exports. Its deepwater port is one of the world's busiest.
Companies based in Hong Kong employ millions of workers in the neighbouring Chinese province of Guangdong.
China ceded Hong Kong island to Britain in 1842 after the First Opium War. Britain later added parts of the Kowloon peninsula and the many smaller islands surrounding Hong Kong to its holdings.
In the 19th and 20th centuries Hong Kong's population was boosted by the arrival of hundreds of thousands of migrants from China, many of whom were fleeing domestic upheavals. Industrialisation gathered pace, and by the 1970s Hong Kong had become an "Asian tiger"; one of the region's economic powerhouses.
With little room for expansion across its hilly terrain, high-rise Hong Kong has among the highest population density in the world; some 6,300 people per square kilometre. Skyscrapers and temples, shopping malls and traditional markets sit cheek-by-jowl.
But amid the urban hustle there are quiet parks and green spaces, beaches and mountain-top views.
* Territory: Hong Kong
* Status: Semi-autonomous, special administrative region of China
* Population: 7 million (World Bank, 2010)
* Area: 1,098 sq km (424 sq miles)
* Major languages: Chinese (mainly Cantonese), English (both official)
* Major religions: Buddhism, Taoism
* Life expectancy: 80 (men), 86 (women)
* Monetary unit: Hong Kong dollar
* Main exports: Electrical and electronic goods, clothing
* GNI per capita: $32,780 (World Bank, 2010)
* Internet domain: .hk
* International dialling code: +852
Chief executive: Donald Tsang
Donald Tsang, a career civil servant, was chosen as chief executive in June 2005 by the Election Committee - a 796-member, Beijing-backed panel. He succeeded Tung Chee-hwa, Hong Kong's first post-colonial leader, who resigned after complaining of poor health.
In March 2007, Mr Tsang was re-elected by an overwhelming majority of the territory's largely appointed electoral college, defeating pro-reform lawmaker Alan Leong in Hong Kong's first contested elections.
Analysts predicted little change in policy under Mr Tsang, although his extrovert manner and flamboyant dress sense - including a penchant for bow ties - distinguish him from his predecessor.
His challenges include maintaining the territory's economic edge and balancing calls for democracy with the demands of his political masters in Beijing. Mr Tsang proposed limited changes to Hong Kong's electoral system, but these were vetoed in late 2005 by pro-democracy legislators who said they were inadequate.
Born in 1944, Mr Tsang joined the government in 1967 and served under several British governors. Most of his posts were concerned with finance.
Pro-democracy demonstrations beleaguered his predecessor, Tung Chee-hwa. A proposed anti-subversion bill was seen as an attempt to weaken civil liberties and was thrown out in 2003 after a mass protest.
Moreover, Mr Tung was beset by crises, including the Asian financial slump of the late 1990s and the Sars epidemic of 2003.
After stepping down he joined China's top political advisory body.
From : BBC News