Budapest , the capital of Hungary , is one of the largest cities of Eastern Europe . city , capital of Hungary , and administrative centre of Budai jaras ( district ) and Pest megye ( county) . Budapest , the capital of Hungary , is one of the largest cities of Eastern Europe . Hungary's reduction in size following World War I did not prevent Budapest from becoming , after Berlin , the second largest city in central Europe . Built on the banks of the Danube River in northern Hungary , Budapest is an important artistic , cultural , and scientific center . Once called the "Queen of the Danube," Budapest has long been the focal point of the nation and a lively cultural centre . It was once popularly known as the "Queen of the Danube." Once called the "Queen of the Danube," Budapest has long been the focal point of the nation and a lively cultural centre . Budapest consists of two principal parts that were merged in 1873 . It consists of two parts , Buda and Pest , which are situated on opposite sides of the river and connected by a series of bridges . Buda is located on the west bank of the Danube . It consists of two parts , Buda and Pest , which are situated on opposite sides of the river and connected by a series of bridges . Pest is on the opposite , east bank . It consists of two parts , Buda and Pest , which are situated on opposite sides of the river and connected by a series of bridges . Pest is on the opposite , east bank . The city has marked topographical contrasts: Buda is built on the higher river terraces and hills of the western side , while the considerably larger Pest spreads out on a flat and featureless sand plain on the river's opposite bank . Buda features many hills , while Pest is relatively flat . The city has marked topographical contrasts: Buda is built on the higher river terraces and hills of the western side , while the considerably larger Pest spreads out on a flat and featureless sand plain on the river's opposite bank . The central hill , Castle Hill , is the site of an old fortress and the royal palace . In a central position is Castle Hill ( Varhegy ) , 551 feet ( 168 metres ) above sea level and crowned by the restored Buda Castle ( Budai var , commonly called the Royal Palace) . To the south is Gellert Hill , which features the 19th-century Citadel . To the south of Castle Hill rises the higher Gellert Hill ( 771 feet ) , a steep limestone escarpment overlooking the Danube , which provides a panoramic view of the whole city . Rozsa Hill lies north of Castle Hill . Rozsa ( Rose ) Hill , the third hill near the river , lies north of Castle Hill . It is the most fashionable district of Budapest , where Hungary's wealthy have houses . It is the most fashionable district of Budapest , where Hungary's elite have houses . It features several museums , including the Museum of Fine Arts and the National Museum , the Opera House , and the zoo . The Museum of Fine Arts , other museums , the Budapest Zoo , the renowned city circus , and an amusement ground ( which was once called the "English Park" ) are all found nearby . Budapest is Europe's largest spa town; there are more than 100 hot springs that spout from Buda's limestone bedrock . There are numerous underground hot springs that contain radium and other minerals , and , since Roman times , bathers have sought them out for their supposed healing properties . Budapest is also the major industrial center in Hungary . There is evidence of human settlement on the western bank of the Danube from as early as 2000 BC . Budapest's location is a prime site for habitation because of its geography , and there is ample evidence of human settlement on the Danube's western side from Neolithic times onward . One of the first organized settlements on the site , though , was the Roman fortress of Aquincum . This became Aquincum when the Romans established a military camp and civilian town there at the end of the 1st century AD . Aquincum was built at an easy crossing place on the Danube at the end of the 1st century AD . This became Aquincum when the Romans established a military camp and civilian town there at the end of the 1st century AD . In 1541 the Turks took the area and held it until 1686; the city changed very little during this time . The Turks held Buda between 1541 and 1686 . German troops occupied Budapest and the rest of Hungary during World War II . Hungary , a satellite of Germany in the war , was occupied by the German army in March 1944 . The city suffered further damage in 1956 , when Soviet forces entered it to put down an uprising against the Communist government . The "seven days that shook the Kremlin" ended in tragedy: the Soviet army retook Budapest , the town once more suffered damage , and the country was forced back into the communist mold . In the late 1980s Budapest became the center of the reform movement that swept Eastern Europe and led to the fall of the Communist government . Budapest again became the focus of national political drama in the late 1980s , when Hungary led the reform movement in eastern Europe that broke the communist monopoly on political power and ushered in the possibility of multiparty politics .