The Aztecs lived in central Mexico, primarily in the Valley of Mexico. They founded their capital city, Tenochtitlán, on a small island in Lake Texcoco in 1325. This area is now the site of modern-day Mexico City. The Aztec Empire grew to dominate much of central and southern Mexico, with Tenochtitlán becoming a densely populated and powerful city surrounded by many smaller city-states they ruled through alliances, commerce, and conquest.