A shtetl is a small community with a population which is primarily Jewish. This term is most typically used to refer to Jewish communities in Eastern Europe which thrived until the Holocaust in the mid-20th century, and shtetl life is largely considered to be extinct today. While there are numerous communities around the world with a big Jewish population, most notably of course in Israel, these communities are not quite analogous to the shtetls of Poland, Lithuania, Belarus, and the Ukraine.
The roots of the shtetl lie in the late 1700s, when Catherine the Great of Russia created the Pale of Settlement. Jewish citizens of Russia could only live in the Pale, a region along the Western border of Russia. The creation of the Pale was designed to force Jewish people to the fringes of Russian society. Settlements in the Pale tended to be characterized by extreme poverty, but they were also pious, vibrant communities filled with citizens who made the best with what they had.
Jewish people who wanted to live outside the Pale of Settlement had to apply to the government, and their requests were often denied. Gentiles, however, were welcome to settle in the shtetls, and some had a population which was up to half-gentile. Life in the shtetl tended to revolve around the Jewish calendar, with the synagogue and school taking a place of pride in the community.
Merchants and artisans settled in the downtown areas as well, with citizens living around the fringes of the shtetl. Many historians have idealized shtetl life, talking about the strong sense of community, frequent community events, and deep attachment to religious faith which characterized life in these communities. However, shtetls were also a form of segregation used to deny the Jewish community access to good farmland and the bulk of Russian culture and commerce. Shtetl residents valued education highly, along with charity and a strong work ethic, and there were definite class barriers in these communities, with a very fixed way of life that changed little for almost two centuries.
In the late 1800s, Czar Alexander III passed the May Laws, a series of supposedly temporary regulations which were used to discriminate against the Jewish community. Jewish people were not allowed to live in rural areas, even in the Pale, and they were denied access to education and many professions. Jewish people were also forcibly removed from Russia's major cities, and many Jewish people immigrated during this period to seek out better living conditions, shrinking the number of shtetls radically. Those which remained were decimated by the Nazis during the Holocaust, and though many former shtetls exist today, their populations are no longer primarily Jewish.