Vatican Hill (in Latin, Mons Vaticanus ) is the name given, long before the founding of Christianity, to one of the hills on the side of the Tiber opposite the traditional seven hills of Rome. It may have been the site of an Etruscan town called Vaticum.
The name "Vatican" has often been thought to derive from the Latin "vates", meaning "seer, soothsayer", though this is uncertain and it is also possible that "Vaticanus" comes from an unrelated Etruscan loan-word.  Indeed, the Vatican Hill was the home of the Vates long before pre-Christian Rome. Vaticanus, also known as Vagitanus, was an Etruscan god of prophecy, and his temple was built on the ancient site of Vaticanum (Vatican Hill). 
In the 1st century AD, the Vatican Hill was outside the city limits and so could feature a circus (the circus of Nero) and a cemetery. St. Peter's Basilica is built over this cemetery, the traditional site of St. Peter the Apostle's grave. There was another cemetery nearby, which was opened to the public on 10 October 2006 to commemorate the 500th anniversary of the Vatican Museums.
The Vatican Hill is not one of the famous seven hills of Rome although it was included within the city limits of Rome during the reign of Pope Leo IV, who, between 848 and 852, expanded the city walls to protect St. Peter's Basilica and the Vatican. Thus, Vatican Hill has been within the walls and city limits of Rome for over 1100 years. Until the Lateran Treaties in 1929 it was part of the Rione of Borgo.
Before the Avignon Papacy (1305–1378), the headquarters of the Holy See were located at the Lateran Palace. After the Avignon Papacy the church administration moved to Vatican Hill and the papal palace was (until 1871) the Quirinal Palace, upon the Quirinal Hill. Since 1929, part of the Vatican Hill is the site of the State of the Vatican City. However, the cathedral of the Bishop of Rome, the Pope, is not St. Peter's in the Vatican, but Basilica di San Giovanni in Laterano, which is extra-territorially linked, as indicated in the Lateran Pacts signed with the Italian state in 1929, with the Holy See.