The adapatable humans made use of magic they could seize or learn from the Proud people to defeat all enemies, breaking (for a time) the power of giants and orcs. Waterdeep was founded. The last of the pure blood elves died out, a result of continued marriage with humans.
In the far west, men also dwelled - wise, clever primitives called the Ice Hunters. They lived simple lives on the coast since time beyond reckoning, countless generation before Netheril's first founders set foot on the Narrow Sea's western shore. Yet this peaceful folk fell prey to another invasion from the south: crude longships that carried a tall, fair-haired warlike race who displaced the Ice Hunters from their ancestral lands.
This race, known as the Northmen, spread farms and villages along the coast from the banks of the Winding Waters to the gorges of Mirar. Northmen warriors drove out the simple Ice Hunters farther and farther north, forced the goblinkin back to their mountains haunts, and instigated the last Council of Illefarn, Within 500 years of the Northmen's arrival, Illefarn was no more - its residents had migrated to Evermeet.
From the coast, Northmen sailed westward, claiming and establishing colonies on the major western islands of Ruathym and Gundarlun, eventually spreading to all islands in the northern sea. Others migrated northward, past the Spine of the World, and became the truly savage barbarians of Icewind Dale.
In the centuries that followed, Ascathom became Hellgate Keep when it fell in the hands of fiends, and Eaerlann collasped under the attack of a new orc horde. The elves fled southwest, joining with Northmen, Netherese descendants, and dwarves to form what would later be known as the Fallen Kingdom. This realm was short-lived and collapsed under the next orcish invasion - though in dying, it dealt the goblin race a blow from which they have yet to recover.