Stepanakert is the capital and the largest city of the Republic of Artsakh, which is a de facto independent republic in South Caucasus. During Artsakh liberation war (1990-94), when it became a free state from Azerbaijan, the latter's government renamed it into Khankendi, that's why it can be seen like that as well. The name of it means the city of Stepan Shaumian, an Armenian Bolshevik revolutionary, one of the 26 Baku commissars. As of 2015, the population of Stepanakert is 55.000, or 40% of the state. Now it's a cultural, educational and administrative center, with libraries and institutions, theatres and museums. The city is twinned with Montebello (California, the USA, 2005), Yerevan (2012), San Sebastian (Spain, 2014).

Tatik-papik (Grandma and Grandpa) or "We Are Our Mountains" is a large monument north of Stepanakert, on the way to airport. It is widely regarded as a symbol of the Armenian heritage of Artsakh. The monument is made from volcanic tufa from Aragats mountain and depicts an old man and woman hewn from rock, representing the mountain people. The sculpture is prominent in Artsakh's coat of arms. This monument generated great controversy when it was first erected. Azerbaijan exercised sovereignty over Artsakh at that time, and the statue was condemned by the Azeris because it expressed the love of Armenians for this land. After the independence of Armenia, many cultural and youth centres were reopened. The cultural palace of the city is named after Charles Aznavour.

When Artsakh was annexed to Soviet Azerbaijan from Armenia, Stepanakert became the capital of Nagorno-Karabakh Autonomous Oblast (1923-1991). The latter was only 1/3 part of historical Artsakh province, inhabited by 300,000 Armenians then. The Armenians from the other parts were settled to Armenia or Baku, Azerbaijanis and Kurds were settled in those 2/3 parts of Artsakh. In 1988, the Armenian population of NK region became 145.000, and the Azerbaijani population rose from 12.000 to 41.000 here. Another autonomous republic of Nakhijevan, which was annexed to Soviet Azerbaijan, had 2000 Armenian population only. The Supreme Soviet of Nagorno-Karabakh voted to join the Armenian SSR, which was legal, according to the USSR constitution. Later massacres started in Azerbaijan, and 400.000 Armenians left the country. Azerbaijanis began war against Artsakh in 1990, which finished by the victory of Armenians in 1994.

During the Soviet era, there were no traditional churches in Stepanakert. The late-19th-century church of Saint George was destroyed in the 1930s to build the Stepanakert Drama Theatre. Currently, the church of Surp Hakob (or Saint James) opened in 2007 is the only church of the city, which was consecrated on 9 May 2007, in honor of the 15th anniversary of the liberation of Shushi. The construction of the Holy Mother of God Cathedral was launched in 2006. The inauguration of the church is expected to take place in 2018. There is a small community of Armenian Evangelicals with around 500 members. The Evangelical community supports many schools, hospitals and other institutions through the help of the Armenian Diaspora.
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