Power in ancient Greece became centered around the city-state in the 8th century BC. The city-state was a population center organized into a self-contained political entity. These city-states often lived in close proximity to each other, which created competition for limited resources. Though conflict between the city-states was ubiquitous, it was also in their self-interest to engage in trade, military alliances and cultural interaction. The city-states had a dichotomous relationship with each other: on one hand, they relied on their neighbors for political and military alliances, while on the other they competed fiercely with those same neighbors for vital resources. The Olympic Games were established in this political context and served as a venue for representatives of the city-states to peacefully compete against each other.
The spread of Greek colonies in the 5th and 6th centuries BC is repeatedly linked to successful Olympic athletes. For example, Pausanias recounts that Cyrene was founded c. 630 BC by settlers from Thera with Spartan support. The support Sparta gave was primarily the loan of three-time Olympic champion Chionis. The appeal of settling with an Olympic champion helped to populate the colonies and maintain cultural and political ties with the city-states near Olympia. Thus, Hellenic culture and the games spread while the primacy of Olympia persisted.
The games faced a serious challenge during the Peloponnesian War, which primarily pitted Athens against Sparta, but, in reality, touched nearly every Hellenic city-state. The Olympics were used during this time to announce alliances and offer sacrifices to the gods for victory.
During the Olympic Games, a truce, or ekecheiria was observed. Three runners, known as spondophoroi, were sent from Elis to the participant cities at each set of games to announce the beginning of the truce. During this period, armies were forbidden from entering Olympia. Legal disputes and the use of the death penalty were forbidden. The truce — primarily designed to allow athletes and visitors to travel safely to the games — was, for the most part, observed. Thucydides wrote of a situation when the Spartans were forbidden from attending the games, and the violators of the truce were fined 2,000 minae for assaulting the city of Lepreum during the period of the ekecheiria. The Spartans disputed the fine and claimed that the truce had not yet taken hold.
While a martial truce was observed by all participating city-states, no such reprieve from conflict existed in the political arena. The Olympic Games evolved the most influential athletic and cultural stage in ancient Greece, and arguably in the ancient world. As such the games became a vehicle for city-states to promote themselves. The result was political intrigue and controversy. For example, Pausanias, a Greek historian, explains the situation of the athlete Sotades,
Sotades at the ninety-ninth Festival was victorious in the long race and proclaimed a Cretan, as in fact he was. But at the next Festival he made himself an Ephesian, being bribed to do so by the Ephesian people. For this act he was banished by the Cretans.
Source: Wikipedia
