Balinese culture was strongly influenced by Indian, and particularly Sanskrit, culture, in a process beginning around the 1st century AD. The name Balidwipa has been discovered from various inscriptions, including the Blanjong charter issued by Sri Kesari Warmadewa in 913 AD and mentioning Walidwipa. It was during this time that the complex irrigation system subak was developed to grow rice. Some religious and cultural traditions still in existence today can be traced back to this period. The Hindu Majapahit Empire (1293–1520 AD) on eastern Java founded a Balinese colony in 1343. When the empire declined, there was an exodus of intellectuals, artists, priests and musicians from Java to Bali in the 15th century.

Bali lies 3.2 km east of Java and approximately 8 degrees south of the equator. East to west, the island is approximately 153 km wide and 112 km north to south (95 by 69 miles, respectively), with a surface area of 5,632 km². The highest point is Mount Agung at 3,142 m (10,308 feet) high, an active volcano that last erupted in March 1963. Mountains cover centre to the eastern side, with Mount Agung the easternmost peak. Mount Batur (1,717 m) is also still active. About 30,000 years ago it experienced a catastrophic eruption — one of the largest known volcanic events on Earth. In the south the land descends to form an alluvial plain, watered by shallow rivers, drier in the dry season and overflowing during periods of heavy rain.

Bali's population adheres to Balinese Hinduism, formed as a combination of existing local beliefs and Hindu influences from mainland Southeast Asia and South Asia. Bali population itself during 2005 was 3.151.000 people.

Bali is famous for many forms of art, including painting, sculpture, woodcarving, handcrafts, and performing arts. Balinese gamelan music is highly developed and varied. The dances portray stories from Hindu epics such as the Ramayana. Famous Balinese dances include pendet, legong, baris, topeng, barong, and kecak (the monkey dance). The Hindu new year, Nyepi, is celebrated in the spring by a day of silence. On this day everyone stays at home and tourists are encouraged to remain in their hotels. On the preceding day large, colorful sculptures of ogoh-ogoh monsters are paraded and finally burned in the evening to drive away evil spirits. Other festivals throughout the year are specified by the Balinese pawukon calendrical system.