First, it's important to understand how Rome's hills were formed. Think of a plain with a river running through it approximately from north to south. The river cuts a channel which, of course, over time, widens to form a flood plain through which the river meanders when it is at normal levels. Streams feeding into the river erode valleys that descend from the upper plain down to the flood plain. Ridges of land that are not eroded remain between the valleys leading down to the river. Sometimes, the ends of ridges are cut off by changes in the course of the streams or by flooding of the river and these "loose ends" become isolated hills. In Rome, both ancient and modern, a confusion factor is added by using the word "hill" to describe both the ridges and isolated hills: the Quirinal, Viminal, Esquinal, and Caelian are actually ridges, and the Aventine, Palatine, and Capitoline are "loose end" hills. Some of the ridges and hills have multiple high points and these also were called hills at various times.
The Capitoline Hill is the smallest in surface area of Rome's traditional seven hills, but it is also the highest. It has two high points, which the ancients Romans called the Arx and the Capitolium. The Ancients knew which was which, but that information was somehow lost over the centuries -- all the historians knew was that the very large temple of Jupiter Optimus Maximus stood on the Capitolium and that the other high point was the Arx. The mystery was solved in 1875 when Rudolfo Lanciani, Italy's ace Roman archeologist, found the platform of the Jupiter temple below the garden between Palazzo Conservatori and Palazzo Caffarelli on the southern height. Excavations around the platform have continued in fits and starts until today -- University of Texas scholars are now prominent on the team..
The contours of the Capitoline Hill have been softened, mostly by human activity, in the intervening centuries and it's now hard to see how very defensible the hill was in ancient times: the slopes are much more gradual now, and the level of the central saddle has risen by about seven meters. Michelangelo's gentle "scalinata" up the western slope wasn't there in ancient times: the Capitoline monuments faced east then, toward the Forum, and any access up the western side was a fairly late addition. By the time the scalinata was built, the street level at the bottom end had already risen about eight meters.
When you visit the Capitoline Hill today, you can best visualize the heights if you stand on the Campidoglio pavement (finally added in the 1930s, with colors reversed from Michelangelo's drawings) right in front of and facing the fountain. From there you can see the steep flights leading up on opposite sides of the square: to the north, over your left shoulder, are the stairs up to the side door of the church of Santa Maria in Ara Coeli on the Arx -- and to south, over your right shoulder, are the flights up to the Capitolium.
On the more northerly height, the Arx, there stood a temple dedicated to Juno Moneta, that is, Juno who warns of approaching danger. Early bronze money was made at this temple, and its name is the origin of our words "money" and "monetary". The Arx is also thought to be the site of an open air "templum" where augurs watched the activities of birds to see if it was safe to undertake proposed actions. Thatâs the place where all young men went the first time they put on the forma "toga virilis" (toga of manhood) and assumed the rights and duties of citizenship at age 14. Juno Moneta is thought to have been where the Ara Coeli church is now, but there is no real proof of where the templum was -- perhaps it's under the Victor Emanuel monument.
A saddle called the Asylum joined the two heights, and in the center of the Asylum, in about 190 BC was built, a temple of Vediovis (Vejovis). The remains of this temple, which are well preserved because they were protected by the Tabularium, into which it was later integrated, can be seen under the Palazzo Senatorio on the Campidoglio (go down through the Museums toward the Tabularium). Vediovis is usually identified as an aspect of Aesculepius, and this temple may have been located at the point of quarantine for new arrivals. (The Etruscan god Veive may also be somewhere in the background of Vediovis. Even in ancient times, however, Vediovis was sometimes misidentified as Jupiter -- Jupiter held aloft a bundle of lightning bolts, and Vediovis either held lightning bolts or arrows, and Vejovis sounds almost the same as Jovus, an alternate name for Jupiter.) The limbless cult statue is now on view in the corridor outside the temple. The temple is unusual in that its entry porch is on one of its long sides, rather than on one of the shorter ends of its rectangular shape. Many archeologists think that the entry was moved to the side when the temple was incorporated into the tabularium.
The whole of the hill, the Arx, Capitolium, and Asylum, rose above the marshy flood plain on steep defensible cliffs. The early Romans, seeking to increase their population and the size of their fighting force, advertised that fugitives (essentially, the male criminal element from other towns) would be welcome to settle and serve a probationary (and perhaps quarantine) period in the Asylum. The Asylum was only half as high as the Capitolium and Arx, so the Romans could also keep a watchful eye from above on the new arrivals. The location of the Asylum offered the newcomers some protection, but it also made it likely that they would be the first to feel the force of any outside attack -- a test of both their courage and their newly acquired loyalty to Rome. You can see a view of the Capitoline Hill in about 350 BC on the Internet at http://sites.netscape.net/photmmdtkw/CapitolineHill.jpg.
Other Capitoline Hill Internet sites:
Another (smaller) view of the Hills of Rome: http://www.agora.stm.it/P.Howarth/e-02.htm
University of Caen (France) -- During the Empire: http://www.unicaen.fr/rome/geographique/capitole.html
Lanciani's description of his discovery
of the Jupiter Temple: http://www.ukans.edu/history/index/europe/ancient_rome/E/Gazetteer/Places/Europe/Italy/Lazio/Roma/Rome/.Texts/Lanciani/LANPAC/2*.html#sec16