The Trade Federation is an organization led by Nute Gunray and an antagonistic faction in the Star Wars universe. They serve as the main antagonistic faction of Star Wars Episode I: The Phantom Menace. Cold, calculating Neimoidians run this mega-corporation, which has grown rich on the profits of war. The organization also received backing from Darth Sidious who uses the Federation for his own plans of conquering the galaxy. Only a few members of the Trade Federation know of Sidious' existence and role such as Nute Gunray and Daultay Dofine. The Federation has a large army that could rival the Republic. By Star Wars Episode II: Attack of the Clones, the organization merged with the Confederacy of Independent Systems.
In Star Wars Episode I, Gunray led a trade blockade on Naboo to protest against the taxation on Free Zones of the Galaxy. He was also commanded by Darth Sidious to attack Naboo. Sidious assured Gunray that they would not face actions from the Galactic Senate. The military of the Trade Federation took over the planet but the Queen escaped to Coruscant for help.
In Star Wars Episode II, Nute Gunray attended Dooku's meeting and had the Trade Federation merge with the Separatists. The head of the Trade Federation, Nute Gunray, has put is Droid Armies in the service of the Separatists. In return, the Sith sometimes tell him which planets are ripe for plunder, and the Federation's forces move in. Following Gunray's death at the hands of Darth Vader, the Federation is nationalized by the newly formed Galactic Empire.
After the death of Gunray, Sentepeth Findos became the new Viceroy of the Federation. At the conclusion of the war he was forced to sign over control of the Federation's assets to the Empire.
A few members of the Federation resisted the handover of control of the Federation's assets. After that resistance was crushed, the Trade Federation continued as a puppet government of the Empire. The Trade Federation was officially disbanded at the same time when Imperial Senate was disbanded in 0 BBY.
Some Trade Federation material and personnel were later absorbed in to the Rebel Alliance, which eventually overthrew the Galactic Empire 4 years after the Battle of Yavin.