The Vatican City State is a neutral nation, which has not engaged in any war since its formation in 1929 by the Lateran Treaty. It has no formal military compact or agreement with neighbouring Italy, although responsibility for defending the Vatican City from an international aggressor is likely to lie primarily with the Italian Armed Forces. When presenting the Lateran Treaty to the Italian parliament in 1929, Benito Mussolini declared: "It is evident that we [the Italian state] will be the necessary guarantors of this neutrality and inviolability [of Vatican City], since, in the remote hypothesis someone wanted to hurt her, he would first have to violate our territory." Although the Vatican City State has never been at war, its forces were exposed to military aggression when it was bombed during World War II, and whilst defending Vatican property in Rome during the same conflict.

Although the former Papal States were defended by a relatively large Papal Army (including the Corsican Guard, active from 1603 to 1662) and a Papal Navy, a majority of these forces were disbanded when the Papal States ceased to exist in 1870. Immediately prior to the disbandment, the Esercito Pontificio (Papal Army) comprised two regiments of locally recruited Italian infantry, two Swiss regiments, a battalion of Irish volunteers, artillery and dragoons, plus the international Catholic volunteer corps the Papal Zouaves, formed in 1861 to oppose Italian unification. Following defeat and abolition of the States by the Kingdom of Italy, four small Papal units (the Pontifical Swiss Guard, the Noble Guard, the Palatine Guard, and the Papal Gendarmerie Corps) were retained, but restricted their activity to the Vatican in Rome.

Upon the 1929 formation of the Vatican City State, a unique form of sovereignty was defined. Under this agreement sovereignty is vested in the much more ancient Holy See, which is an ecclesiastical jurisdiction; but that sovereignty is exercised over the actual nation state of the Vatican City, an area of 49 hectares (120 acres) defined in a map appended to the treaty, together with certain other properties formally located within the Italian state, but granted extraterritoriality.

The Vatican City State has never had independent armed forces, but it has always had a de facto military provided by the armed forces of the Holy See: the Pontifical Swiss Guard, the Noble Guard, the Palatine Guard, and the Papal Gendarmerie Corps. In practical terms, these armed forces have operated chiefly within the Vatican City State and the Papal Palace of Castel Gandolfo, and not in the many other extraterritorial properties of the Holy See, except during the time of World War Two when troops of the Palatine Guard were deployed to all Papal properties in and around Rome.

As part of a major reform in 1970 by Pope Paul VI, two of the units were disbanded, one was retained, and one was restructured into a civilian police service.