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During the time of Neanderthals in Europe, the newcomers to Europe have begun to cause problems. Homo sapiens, as we will know them, have begun to push the Neanderthals out of the best land. This will continue year after year, with the forces of time turning against the Neanderthals. But there is hope, in a way. As the Neanderthals are pushed into the poorer lands, such as the high mountains and valleys, they fall prone to the danger of being isolated during Ice Ages.
This is what happens, as a series of Neanderthal tribes are cut off from the outside world in the mountains of Europe. Evolution takes control, evolving a new species of Neanderthals. The shortages in food means that the great size of the Neanderthals drops greatly, smaller than the Homo sapiens they compete with. Cold forces them to evolve smaller arms and legs, so there is less surface area for heat to escape. The new Neanderthals are short and stocky, and rather hairy.
History continues to go forward, with Homo diminuensis inhabiting the mountain ranges of Europe. When civilization comes to the Homo sapiens, trade will bring such ideas to the Dwarves. Like interactions between Human groups, the relationship between Humans and Dwarves is different on a tribe by tribe basis. Sometimes there is war, sometimes there is trade. The mountains remain a homeland for the Dwarves, with large fortresses and keeps being built to protect them when Humans decide in favor of war.
This all changes with the rise of Rome. A new group of Humans, they are strong enough to conquer a majority of the Humans in Europe, and also have a desire for metals like gold and silver. The Dwarves have the luck, or misfortune, of living not only in the areas of the mines, but having a small size that is desired for miners. Roman Legions are let loose on the Dwarven Keeps, and after a series of conquests the Dwarves are put to the mines.
Some places, like Dacia, turn into large scale Dwarven Camps with mines for Gold and Silver. Dwarves are treated as slaves, some being forced to fight in the Gladiatorial games. Some are forced away from their native homelands and settled in Britain, to work the tin mines there. This is the time of the Dwarven Diaspora, with the groups being spread across Europe. Dwarves develop their reputation as miners and fighters, and soon their larger body to brain ratio and better hand-eye coordination means they are used in detailed tasks such as blacksmiths.
The Dwarf religion is a monotheistic view that would be difficult to explain. It is heavily influenced by the Romans during the Diaspora, but focuses on the multiple rites of passage during the life of a Dwarf. Life is like a stairway to heaven, each step brings you closer. It is often fatalistic during life, with the promise of a better afterlife. With the introduction of Christianity and the Fall of Rome, the Dwarves are put into a bad situation. Like the Jews, they are often viewed as evil during the Middle Ages. Only their skill as fighters and ability to craft metal allows them to survive, and that only when on the good side of the local lord. In some regions, the Dwarves simply retreat higher into the Mountains when the Roman Empire falls. By the year 1000, they have gained a place in European society as crafters of metal, and of miners, similar to the banking position of the Jews.
Dwarves are closely associated with the earth, mining, metalworking, and the hoarding of treasure. They are generally around 3 feet tall, with a stocky, badly proportioned body shape. This is because evolution of the Dwarves took place in the cold regions of the Mountains, forcing a smaller surface area with less chance for heat to escape. They generally are hairy, another adaptation. The Dwarf population is low because of the long gestation period of the females, which allows for the Dwarven child to be better developed at birth compared to the Humans. Stories of Dwarven children being abandoned in the wilderness at birth and surviving to adulthood are common.
The homeland of the Dwarves is Central Europe. Three types of Dwarves inhabit Europe, the divisions probably due to isolated of the Dwarven Population early in time. Black dwarves and Brown dwarves, named because of the most dominate color of hair, are rare and usually are native to regions that were not completely conquered by the Romans. Native to areas like Scandinavia, they rarely interact with Humans and were not spread across Europe by the Roman slave traders.
White dwarves are the type most widely known about, being the ones that were spread by the Roman slave traders. They are more comfortable in non-Mountainous areas and often have a higher level of civilization compared to the other two races. As experts in metal working and the entire process of mining the ore to smelting, to smithing, they are often a prized possession for the feudal lord, although seen as evil by the common peasants.
Regional names for dwarves include: ludki in Slavic, lutki in Hungarian, duergar in England, and dvergar in Norse. Dwarven life focuses on the rites of passage during life, which start with the first forging of their weapon, going onward to finishing their greatest creation, after which they are expected to no longer forge and to retire. Weapons are usually passed down from father to son, and with each Dwarf adding to the collection. Because of this, Dwarves will often have large hordes of finely crafted weapons. This contributes to the idea of being great hoarders of countless treasures.
It is difficult to describe the Dwarven religion without setting aside a specific area for it. Experts on Jewish religion will find many similarities between the Dwarven religion and that of the Jewish people. Some may claim this is because of the similar development of the people, outcasts of society. Fanatics claim that the similarity is because both groups of people serve the Devil, but that is the view of a few extremists.
Dwarven religion dates back to man being created out of clay, which the Creator thought would make a good creature. The clay was easy to form into a shape, so many were made. But when the Creator took them out of the kiln, he say that they were too easy to be broken. And so he turned to stone, which took much longer to form into a shape, but wasn't as easy to break, and made the first Dwarves. This is why humans are so large in number compared to Dwarves. Seven Dwarves and their mates were originally made, and told to inhabit the lands of the birth, the lands of stone. Dwarven religion is heavy in stories about creation, with a tale very similar to the Jewish story of the Golem. The large amount of legends and myths in the Dwarven religion makes many believe that it is a very developed religion, that has been changing and evolving with the Dwarves from the beginning of their civilization. This is similar to the ideas of the origin of Hinduism and Judaism, a religion that has been evolving with the culture from its birth.
Rites of Passage are a key part of the Dwarven religion. The life span of Dwarves is usually around one hundred years, with the important Rites of Passage every ten years, minor ones spaced in between. Many of the major Rites involve creation of something, weapons, jewelry, or other items. As mentioned above, the last Rite of Passage (other than death) is the creation of the ultimate item of a Dwarf's life, after which they retire from their craft. This is usually on the 100th year of their life, although it can change based on how full a Dwarf believes his life has been.
Past the year 1000 AD, the Dwarves have a multitude of possibilities. Perhaps they will create the Industrial Revolution during the Renaissance. Does Leonardo da Vinci make friends with a Dwarf and invent things he failed to in our history? Will we see a rise of Anti-Dwarfism on the scale of Anti-Semitism? Could the year 2000 hold the possibility of a Dwarven homeland? These are all ideas that could play a part in history past 1000 AD.