‘Over-the-counter’ (‘OTC’) derivatives have attracted unprecedented levels of scrutiny since the global financial crisis which broke out in 2007–8. Yet this would be the wrong place to start in order to understand the modern derivatives markets and the courts’ role in relation to them. This chapter argues that in order to understand post-crisis developments in the OTC markets, including the unprecedented surge of litigation after 2008, it is necessary to place these developments in historical, legal and regulatory context. Having set out important definitions and discussed the main uses of derivatives by way of introduction, the chapter explores the evolution of the modern derivatives markets, highlighting the particular significance of contractual standardisation and market diversification.