When the Ottoman Empire was finally defeated in the early 1900s the territory fell under the rule of the Kingdom of Serbs, Croats, and Slovenes (later Yugoslavia). Immediately after this political entity formed, hostilities began as the Yugoslavian government encouraged Serbs to re-settle in the region, but this was met with resistance by the Albanians, who at the time formed a majority.
During World War II (WWII) Kosovo was briefly united with Albania under Italian occupation, but at the war's conclusion the two were again separated as Kosovo was again incorporated into Yugoslavia. As industry was introduced in Yugoslavia though, many Serbs again left Kosovo and headed for industrial centers, in particular large cities as the ethnic balance again shifted heavily in favor of ethnic Albanians.
Tensions rose beyond repair under the Yugoslav leader, Slobodan Milosevic, who was an ethnic Serb and took power in Yugoslavia in 1989. Milosevic striped the region of Kosovo of many of its rights and closed schools taught in Albanian. The Albanians revolted with violence and shortly after Milosevic sent in the Yugoslav army to suppress the revolts. With no military presence, the Albanians attempted to form a non-violent independence movement.
This non-violence movement was not supported by all though and soon the Kosovo Liberation Army began attacks on the Serbian police, leading to guerilla warfare throughout the region as violence became widespread and refugees fled the country. This escalation in violence peaked in 1997 and 1998, but continued through 1999, in what is commonly known as the Kosovo War.
After Milosevic's refusal to end the violence, NATO bombed Serbia (at the time still called Yugoslavia, but only targets in modern day Serbia were attacked) and many ethnic Serbs came to Milosevic's support, leading to an Albanian "ethnic cleansing" campaign organized and ordered by Milosevic. NATO then continued the bombing until Milosevic finally capitulated and Serbian police and military in Kosovo were replaced by NATO officers as Kosovo became a United Nations-Administered region.
Despite declaring independence in 1990, Kosovo again declared independence in 2008. Despite Serbia's protests on the legality of this proclamation, international courts determined it to be legal and many countries recognized Kosovo's independence, although Serbia still contests this declaration.