In order to establish diplomatic relations with another player, you must first establish an embassy in one of their cities. To establish an embassy, a diplomat or spy must enter that city and select 'Become Ambassador' (or 'Establish Embassy') from the menu.
Once you have any embassy, you can engage in diplomacy with them as follows:
To transfer actual property players must negotiate and arrange a pact. This can be done while the players have contact or may be initiated by a player who already has an embassy with the other. The window this brings up lets each player build a list of items he is offering alongside a list of what he will receive in return. These can include:
Unlike most other diplomatic states, war is declared unilaterally by one player on another; thus, declaring war only requires that you have already met the player once or he has declared war on one of your allies. To declare war on an opponent, cancel any treaties with that player until the War state is reached.
Only the War state allows one to attack a unit or to take a city without inciting a revolt.
Enemy units impose zones of control. Cities can be incited to revolt with no disapproval from the senate.
Sometimes, war becomes too costly for both parties. Cease-fire can then be agreed, which after 16 turns will lead back to the diplomatic state of war.
The first time you meet another AI player, it will always offer you a cease-fire treaty.
Under representative governments, the senate will block an unprovoked attempt to declare war again before the end of a cease-fire; the only way to do so is to dissolve the senate by inciting a revolt, and break the treaty in the ensuing anarchy. (However, the Statue of Liberty allows you to break a treaty and restore order in the same turn.)
In this diplomatic state units impose zones of control.
If you wish to have a permanent peaceful relationship with another player, you may sign a peace treaty. For a transition period there will be an armistice. Like ceasefire, it has a countdown of 16 turns, but unlike a ceasefire ends up in the peace status when the time runs out.
This transition period allows time to move units that would be disbanded under Peace outside of the other player's borders. The AI will always insist on some turns of ceasefire, then armistice, then peace, and will use the armistice to move its units out of the other player's territory.
Breaking an armistice drops you to war. Again, under representative governments, the senate will block an unprovoked declaration of war.
In this diplomatic state units impose zones of control.
A peace treaty may be a step towards an alliance. Or, it might be a way to force an untrusted representative government from entering your territory.
Peace treaties come into effect after 16 rounds of armistice, if no incidents occur. To avoid this, a nation may wish to deliberately spark an incident.
When a peace treaty kicks in, all military units belonging to peace-treaty players inside your border are immediately disbanded. They cannot send military units through your borders. Breaking a peace treaty drops you straight to war. Be careful declaring peace with a nation where military cooperation might later be needed--you each will be unable to enter each other's territory, since that is considered an act of war, and under representative governments, the senate will block an unprovoked declaration of war. The player without a representative government can unilaterally ignore this, but not the player who does have it. Therefore, a player with a representative government only ties his own hands, when he makes peace with a player who has an absolutist form of government. (Anarchical and Absolutist governments are an exception to all these restrictions and are exempt from all the restrictions and consequences mentioned above or below. The same is true for any nation possessing The Statue of Liberty.)
Peaceful units impose zones of control and can't be attacked.
Zones of control don't apply and allied units can enter the same tile (including city and transport). Thus, cities can't be bribed by a diplomat entering in them.
Breaking an alliance drops you to armistice treaty, giving each player time to move their units out of the other player's territory before a new peace treaty kicks in and disbands units.
Again, under representative governments, the senate will block an attempt to break an alliance without provocation.