Background
Ayyubid Sultan Saladin had conquered most of the Frankish Kingdom of Jerusalem, including the ancient city itself, in 1187. The Kingdom had been established 88 years before after the capture and sack of Jerusalem by the First Crusade. The city was sacred to both Christians and Muslims and returning it to Christian hands had been the express purpose of the First Crusade. Saladin's was a Muslim dynasty, and his incorporation of Jerusalem into his domains shocked and dismayed the Catholic countries of Western Europe. Pope Urban III literally died of the shock. The Crusader states had been reduced to three cities along the sea coast, Tyre, Tripoli, Antioch.
The Third Crusade (1189–1192) reclaimed much land for the Kingdom of Jerusalem, including the key towns of Acre and Jaffa, but had failed to take Jerusalem. The Crusade had also been marked by a significant escalation in long standing tension between the Germanic princes of western Catholicism and the Byzantine Empire still centered on Constantinople. The experiences of the first two Crusades had thrown into stark relief the vast cultural differences between the two Christian civilizations. The Latins (as the Byzantines called them because of their adherence to the Latin Rite) viewed the Byzantine preference for diplomacy and trade over war, as duplicitous and degenerate, and their policy of tolerance and assimilation towards Muslims as a corrupt betrayal of the faith. For their part, the educated and wealthy Byzantines saw the Latins as lawless, impious, covetous, blood-thirsty, undisciplined, and (quite literally) unwashed. The leader of the Third Crusade Holy Roman Emperor Frederick I Barbarossa openly plotted with the Serbs, Bulgars, Byzantine traitors, and even the Muslim Seljuks against the Empire and at one point even sought Papal support for a Crusade against the Orthodox Byzantines. The Third Crusade had also seized the breakaway Byzantine province of Cyprus. But rather than return it to the Empire, Richard I of England sold the island to the Knights Templar
Barbarossa's army had quickly disintegrated and took ship back to Europe after his death, leaving the English and French, who had come by sea, to fight Saladin. In 1195, Henry VI, son and heir of Barbarossa, sought to efface this humiliation by declaring a new Crusade and in the summer of 1197 a large number of German knights and nobles, including two Archbishops, nine bishops, five dukes and numerous other nobles sailed for Palestine. There they captured Siddon and Beirut, but news of Henry's death along the way, sent many of the leaders quickly back to their estates in Europe. Deserted by their leaders, the rank and file Crusaders panicked before an Egyptian army and fled to their ships in Tyre.
Also in 1195 Byzantine Emperor Isaac II Angelos was deposed by his brother in a palace coup. Ascending as Alexios III Angelos, the new emperor had his brother blinded (a traditional punishment for treason) and imprisoned. Ineffectual on the battlefield, Isaac had been an incompetent ruler who had let the treasury dwindle, outsourced the navy to the Venetians, and distributed military weapons and supplies as gifts to loyalists, fatally undermining the Empire's defense. But the new Emperor was to prove even worse. Anxious to shore-up his position, he bankrupted the treasury. His attempts to secure the support of border commanders undermined central authority. He neglected defense and diplomacy completely and was reduced to plundering Imperial tombs to meet expenses. His chief admiral and brother-in-law of the Empress, Michael Stryphnos, reportedly sold the fleet's equipment down to the nails to enrich himself.
Read more about this topic: Fourth Crusade
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