This doctoral thesis contains an analysis of life of the inhabitants of Zadar and its surroundings, as well as the level and modality of their interactions, between the First World War and the end of the third decade of the 20th century. The centuries-old interaction of the city and its surroundings conditioned by the existence within the same states was disrupted by the 1920 Treaty of Rapallo, which gave the city of Zadar and its municipalities Arbanasi, Crno, Bokanjac and a part of Diklo to the Kingdom of Italy. The thesis employs a phenomenological approach to the subject via critical analysis of archival materials in State Archives in Zadar, the Archives of Yugoslavia in Belgrade, the Central Archives of the State in Rome, and the US National Archives, comparing them with contemporary journalism and first-person testimonies. During the peace conferences held after the First World War, Zadar became a symbol of a demonstration of force; in the time leading up to the ratification of Treaty of Rapallo, Zadar’s history reflects the bilateral conflict between the two Kingdoms, but also the conflict on the unstable political scene of prefascist Italy. The Treaty’s outcome resulted from political compromises in favor of the strategic interests of Italy at a time when world leaders, unaware of local conditions, shaped politics on a global scale; and when an unclear vision for the postwar reconstruction of the region hindered its socioeconomic development. The conventions of Santa Margherita established the modality of relations between Zadar and its surroundings. However, the conventions themselves gave room to diverse interpretations, and their implementation and legitimacy remained dependent upon the relations between the two countries, which were subject to ebb and flow throughout the interwar period. The inconsistency of the legislative framework for the movement of people and goods slowed trade and opened up space for smuggling, which was recorded throughout the interwar period. Currency exchange left an enduring mark on postwar reconstruction of the region. The late and inconsistent conversion of the Austro-Hungarian crown forced Zadar to transform itself from an officer-like city to one driven by commerce in order to survive. This upended the social structure of the community; meanwhile, local inhabitants faced an abrupt change in their standard of living due to currency devaluation. The hybrid creation of a free customs zone disrupted the exchange of goods and services, which remained limited for some time by complex administration and poor surveillance of the borders. The customs zone thus failed to realize its potential, which left Zadar dependent upon the financial investments of the Kingdom of Italy. In the following years, Italy subordinated the city's economy to underwrite the foreign policy goals of the fascist state. The centralization of the sociopolitical system under fascism was accompanied by an increase in extremism. As Italian society descended deeper into fascism, racial policy toward Yugoslavs became increasingly exclusionary, leaving them exposed to violence and homogenization. The major impact of these developments fell upon the residents of Zadar’s outlying areas, which were increasingly pushed into economic and social decay. Residents of these communities remained dependent upon Zadar and its socioeconomic movements, yet were trapped within the Italian administration and unable to integrate into the framework of the new Kingdom of Serbs, Croats and Slovenes until 1923. Historical sources document violations of provisions - both deliberate and involuntary - which verify the struggle for survival resulting from the crown conversion and the unclear legislative framework for the coexistence of the city and its surroundings. Despite the physical, cultural and economic barriers, Zadar remained the nucleus to which its outlying communities gravitated, thereby maintaining the otherwise disrupted communication between borders.