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The war between the Aesir and Vanir happened near the start of time. The Aesir were the sky gods who lived in Asgard, and the Vanir were the earth gods who lived in Vanaheim.
Related Articles: Yggdrasil. Related Events: The Mead of Poetry.
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Gullveig was a member of the earth gods, the Vanir, and she loved gold and talked about it all day. Tired of hearing her endless ravings the Aesir, the sky gods, bound her in Odin's hall and speared her. They burned her three times with her being reborn, however. Enraged by this, the Earth gods demanded reparation from the Aesir, wanting equal status, which they were not duly given.

In retaliation, the Aesir instead waged war upon the more peaceful Vanir. The Vanir gained an upper hand in the war, with their assailants suffering defeat upon defeat. Finally, after much consideration, the Aesir finally agreed to end their hostility and grant the Vanir equal status to the Vanir.

When they all made peace, all the gods spat into a vessel, creating a wise giant, Kvasir, which later led to the creation of the magic mead. To ensure peace was kept, there was an exchange of hostages. On the side of the Vanir, they gave Njord and his son Freyr as hostages, accompanied by Kvasir, the wisest of the Vanir. The Aesir gave Vili (Odin's brother) and Mimir, the wisest of the Aesir, as hostages.

The Vanir, happy with the exchange and with their new status, soon found out that Vili was not as wise as the Aesir had said him to be, and that all along, Mimir had deceived them by giving Vili advice. They felt cheated and thus decapitated Mimir, and returned his head to the Aesir. The Aesir did not retaliate and Odin had Mimir's head preserved and used it to gain knowledge.

The Aesir were pleased with their hostages, and they were greatly honoured by the gods, eventually giving them places among the Aesir. This resulted in the conversion of the gods from the Vanir, to the Aesir.

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