Esto-Sadok -- When Valter German's ancestors came to the mountains above Sochi from impoverished Estonia, they found a bucolic valley with few traces of the indigenous people chased out by the Tsarist army.

But the history of Russia's brutal deportation of the native tribes from the area some 150 years ago has stirred up international controversy and threatens to taint the Sochi 2014 Winter Olympics.

Russia is trying to promote the area as a skiing destination, with President Dmitry Medvedev and Prime Minister Vladimir Putin regularly photographed sitting on ski lifts and chatting in cafes overlooking the slopes.

Some of Russia's largest companies, including Gazprom, Sberbank and billionaire Vladimir Potanin's Interros group are investing in three resorts that will host most of the Alpine skiing events at the Sochi 2014 Games.

But the giant construction site in the foothills of the Caucasus mountains above the Black Sea has a turbulent history marked by decades of war and ethnic migration.

German's ancestors were among the Estonian families who set up the village of Esto-Sadok, or Estonian Garden, in the late 19th century, said the retired nature reserve ranger who chairs Sochi's Estonian society.

The Estonians settled in the picturesque valley and remained the ethnic majority there until the fall of the Soviet Union. The main activity in the village of 150 was a communal farm that kept beehives.

But the peaceful spot concealed a dramatic history.

More than a decade earlier, the Tsarist army had deported the original residents en masse to Turkey after it had won a long-drawn-out war in the Caucasus.

"When I was growing up, I remember the centuries-old pear and walnut trees left by the native population," German said.

The Russian army had fought part of the Caucasus war against the indigenous tribes in the Sochi area with the aim of pacifying militant neighbors and gaining control of the Black Sea coast, in a campaign documented by poet Mikhail Lermontov.

The site of the future ski resorts was then part of a region called Circassia. At the time it was the largest country in the Caucasus, almost the size of present-day Portugal, said historian Samir Khotko.

To mark the end of the Caucasus war, Tsarist troops staged a large military parade on May 21, 1864 just down the river from Esto-Sadok.

After the Russian victory, the largely Muslim Circassians were deported en masse in what some descendants want to be recognised as genocide of the ethnic group, now numbering several million people across the globe.

"They were massively forced from their burnt-out villages without any means of survival. The deportation was enforced by military troops at a huge human cost. Many died of typhoid fever onshore, in ships or in quarantine after reaching Turkey," Khotko said.

Today the vast majority of Circassians live outside of Russia, with around 800,000 populating Russia's North Caucasus regions of Karachayevo-Cherkessia, Kabardino-Balkaria and Adygea.

While some Russian-based Circassians have not protested the Sochi Olympics, others have called the seeming collective memory loss a slap in the face of their ancestors.

A group from the United States-based diaspora staged a protest in 2010 close to the headquarters of the Russian delegation during the Winter Games in Vancouver, Canada.

The aim of their "No Sochi" campaign is to ban Russia from holding the Olympics on the site of the Circassian "genocide", according to a statement on their website.

Circassians have also convinced the parliament of Georgia to approve a resolution recognising the deportation as genocide on Friday, making Russia's arch-foe the first state to do so, just one day before the 147th anniversary of the end of the Caucasus war on May 21.

The fact that Russia's political rival became involved is partly Russia's fault for ignoring the issue, observers said.

"Russia's political class is missing its chance to regulate the Circassian issue, which is no threat to the (Olympic) games themselves, but could affect their reputation," said political analyst Naima Neflyasheva of the Russian Academy of Sciences.

"Clearly the recognition will throw a shadow on everything that has to do with the Olympic Games," she added.

"Everyone knows perfectly well that there was such a country and such a people, but prefers not to discuss it," said Khotko.

"Whenever you stick your finger into Sochi, you stick it into the Circassian tragedy," he said. "Ignoring it is what provokes indignation."

Back in Esto-Sadok, Valter German looks over the foothills covered with construction cranes and sighs as he tells how most of the area's second wave of settlers, the Estonians, have also left.

"Most of the old-timers from our community sold their houses as soon as the resort craze began," he said. "They didn't want invaders to trample over their land."