The Grand Council is a meeting of representatives from each Great Houses of Morrowind. Morrowind is governed by the Grand Council of five Great Houses: House Redoran, House Telvanni, House Sadras, House Indoril, and House Dres, who rule alongside the King of Morrowind. House Hlaalu previously sat on the Council, but lost its seat to House Sadras in the early Fourth Era.
Each Great House governs a district on mainland Morrowind: Redoran in the northwest, Sadras in the western center, Telvanni in the east, Indoril in the central heartlands and Dres in the southeast.
In 1E 416, the Chimeri hero Indoril Nerevar and the Dwemer leader Dumac Dwarfking created the First Council of Resdayn to jointly rule the area as an independent nation and to succeed in driving the invading Nords out of the region.
Resdayn flourished for a few hundred years until the War of the First Council broke out between the secular Dwemer and the orthodox Great Houses. After Nerevar's death, three of his Lieutenants from House Indoril, Vivec, Almalexia, and Sotha Sil, succeeded to control of the Council, which they renamed the Grand Council of Morrowind.
House Indoril, due to their association with Nerevar and the Tribunal, remained the dominant party in the Grand Council right through until the end of the Second Era.Throughout this time, the Grand Council was responsible for local governance in Morrowind, while Morrowind as a whole was ruled indirectly by the Tribunal.
House Hlaalu became the dominant party after the Treaty of the Armistice was signed by Tiber Septim and Vivec in 2E 896. This is because House Hlaalu were the only house to advocate accommodation throughout this period. House Hlaalu also gained more power by the mass suicide by House Indoril and the assassination of the Lord High Councilor who in turn was an Indoril, and placed a Hlaalu in the position.
In the Fourth Era, House Hlaalu was used as a scapegoat for all Dunmeri problems and was stripped of Great House status and House Sadras took their place. House Redoran, became the prominent power on the Grand council and moved the Capital to Blacklight.