Schengen is a town in Luxembourg where the agreement was signed in 1985. It took effect in 1995, the first members being: Belgium, France, Germany, Luxembourg, the Netherlands, Portugal and Spain.
Now there are 26 Schengen countries - 22 EU members and four non-EU. Those four are: Iceland and Norway (since 2001), Switzerland (since 2008) and Liechtenstein (since 2011).
After the initial seven came Italy and Austria in 1997, Greece in 2000, and the Nordic countries in 2001.
Nine more EU countries joined in 2007, after the EU's eastward enlargement in 2004. They are: the Czech Republic, Estonia, Hungary, Lithuania, Latvia, Malta, Poland, Slovakia and Slovenia.
Only six of the 28 EU member states are outside the Schengen zone - Bulgaria, Croatia, Cyprus, Ireland, Romania and the UK.
Andorra and San Marino are not part of Schengen, but they no longer have checks at their borders.
There is no date yet for Cyprus, which joined the EU in 2004, or for Bulgaria and Romania (joined in 2007) or Croatia (joined in 2013)
The UK and Republic of Ireland have opted out. The UK wants to maintain its own borders, and Dublin prefers to preserve its free movement arrangement with the UK - called the Common Travel Area - rather than join Schengen.
The UK and Ireland began taking part in some aspects of the Schengen agreement, such as the Schengen Information System (SIS), from 2000 and 2002 respectively.
Schengen is often criticised by nationalists and Eurosceptics, such as the French National Front (FN), Dutch Freedom Party (PVV) and UK Independence Party. They say it is an open door for migrants and criminals
Under the Schengen Rules, signatories may reinstate internal border controls for 10 days, if this has to be done immediately for "public policy or national security" reasons.
Which countries have removed internal borders?
If the problem continues, the controls can be maintained for "renewable periods" of up to 20 days and for a maximum of two months.
The period is longer in cases where the threat is considered "foreseeable". The controls can be maintained for renewable periods of up to 30 days, and for a maximum of six months.
But an extension of two years maximum is allowed under Article 26 of the Schengen Border Code, in "exceptional circumstances".
In the Schengen zone currently six states have border controls in place - Austria, Denmark, France, Germany, Norway and Sweden.
Hungary's controls affect two non-Schengen states: Croatia and Serbia. Last October it also imposed temporary controls on the border with Schengen member Slovenia.
In 2005 France reimposed border controls after the bomb attacks by Islamist militants in London.
Austria, Portugal and Germany reimposed border controls for some major sporting events, such as the Fifa World Cup
The main feature is the creation of a single external border, and a single set of rules for policing the border.
The biggest pressure point now is the Aegean Sea, between Greece and Turkey, as thousands of migrants - many of them Syrian refugees - arrive daily from Turkey.
Austria is among several Schengen states that have sharply criticised Greece for failing to register many migrants. But Greece has told its EU partners that they must share the burden - it cannot become Europe's refugee camp.
A Schengen Visa is necessary to travel to a Schengen country or within the area. It is a short-stay visa valid for 90 days. It also allows international transit at airports in Schengen countries.
A short-stay visa costs €60 (£46; $66).
But the visa costs €35 for Russians, Ukrainians and citizens of some other countries, under visa facilitation agreements.
The EU has no visa requirement for citizens of Albania, Bosnia-Herzegovina, Macedonia, Montenegro and Serbia who have biometric passports. These Balkan nations all hope to join the EU. Kosovo is excluded from the arrangement.
Since the scrapping of visas for travellers from the Western Balkans there has been a surge in asylum applications from that region. Many asylum seekers are Roma (Gypsies), who are often desperately poor, marginalised and victims of discrimination.
Most of the asylum claims are submitted in Germany, which already has well-established diaspora communities from the Balkans.
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