Russia has emerged as a much more assertive and self-confident country in 2005.
Closer ties were made with other countries, such as Turkey
But social problems, media control and racist attacks also attracted concern about the country which is due to chair the G8 in 2006, writes the BBC's Russian affairs analyst Steven Eke.
Russia's main achievement this year was the economy.
High world oil prices meant bumper revenues, most of which were invested in a national stabilisation fund.
But international anti-corruption groups warned that doing business in Russia remained an often dirty and sometimes dangerous affair, with graft eating away at politics, business and, increasingly, the judiciary.
Investors kept coming, undeterred by the saga of the Yukos oil company, which reached its conclusion. The company was broken up, with its most lucrative assets going to a major state oil company.
And Mikhail Khodorkovsky, once Russia's richest man, was found guilty of serious financial crimes, and sent to a distant Siberian prison camp for nine years.
From there, he wrote missives, calling on the government to adopt policies that, in his words, took account of Russia's unique history.
Mikhail Khodorkovsky was sent to a Siberian prison
Internationally, relations with the US and the EU strengthened, despite spats with Poland, one of the EU's newest members.
Russia also continued to co-operate over nuclear technology with Iran - despite growing Western suspicion that the Islamic Republic had a secret nuclear weapons programme.
But Russia's continued support for the more repressive countries in the former Soviet Union, especially Uzbekistan, after the massacre of civilians in the city of Andijan, drew criticism from human rights groups.
Inside Russia, special forces killed the Chechen rebel president, Aslan Maskhadov. Russia portrayed it, along with parliamentary elections in Chechnya, as proof of success in its campaign to crush the rebels.
But peace remained elusive, and the conflict seemed to spread. In October, hundreds of armed rebel fighters launched an audacious attack on security and military facilities in Nalchik, the capital of Kabardino-Balkaria.
Troubles in Andijan was one example of continuing conflict
There were dire warnings over Russia's seemingly intractable social problems, especially poverty in the regions, the health crisis, and a looming HIV/Aids epidemic.
Long-awaited social security reform was stymied, when thousands of pensioners came out onto the streets to protest against planned reforms.
As 2006 approaches, one of the major questions is who will emerge as a possible successor to Mr Putin? Already, possible candidates are emerging - from within Mr Putin's current circle of most trusted advisers.