<div style='font: 12pt ; text-align: left; '>Well, when he forged the One Ring, he was not a demonic figure like that shown in the movie, he was still of fair form and also went by a different name (I forget it at the moment). When he declared war on the Elf Kingdoms he quickly gained the upper hand. Yet a people called the Numenoreans (Aragorn's ancestors) who lived on a continent out in the Western Sea (similar to the legend of Atlantis) came and defeated sauron, captured him. Yet his form won them over, they did not believe him to be evil, but wise, and he convinced the Numenoreans to defy the Gods (who he convinced were keeping from humanity the gift of immortality which was granted to the Elves). The Gods retaliated by destroying Numenor, Sauron was killed in the process, but returned to Barad-dur and his one ring and gained a new physical form, he didn't lose any of his power. Yet when the ring was cut from his finger, he immedietly lost it all, and Sauron could not find the ring until the end of the third age which is when the Lord of the Rings takes place.
Before the second age, Sauron was the servant of a God by the name of Morgoth. Morgoth ruled from the North and possessed three gemstones of extraordinary power (a bit of that power is possessed within the Phial of galadriel which is seen in the movies, it contains a bit of the essense of the "star of Earendil" which is the Silmaril of the sky). Sauron under Morgoth normally took the forms of a Vampire or a were-wolf, for Sauron had unique powers, he was a shapeshifter, and a master of necromancy and other dark sorcery. During the time of Lord of the Rings, Sauron didn't have control over the Orcs, rather they followed him, no Balrogs or Dragons bowed to Sauron, and there were many evil things (like the Kraken outside of Moria) who had nothing to do with Sauron; Morogth on the otherhand was the master of all evil things, he was the master and creator of the Balrogs, the Dragons, of all the Orcs, etc.. Morgoth was the creator of all evil existing in the world, and it began with his thoughts of desire. Morgoth is the main character of the book, the Silmarillion, he is also the villain, the Silmarillion is more or less a shortened and organized version of Tolkiens book of lost tales. At the end of the first age, Morgoth was defeated (not killed, he can't be killed, he is locked behind the gates of the night), Sauron was defeaed at the end of the second age, and again at the end of the third, without the existence of the ring, he was never able to take any form recognizable to the physical world ever again. Moroth though is prophesized to return, because as Tolkien's little mythological prophecy goes, though the armies of Orcs and trolls have been wiped out, Morgoth's evil still exists in the world, Morgoth had much sway over mankind.</div>
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