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The Ladder is a competitive type of Closed Realm multiplayer, hosted on Battle.net. It was introduced in Patch 1.10. In order to play and get your name on the ladder, you would have to create a new character from scratch and would not have the aid of any 1.09 or before characters, so everyone was dealt a clean slate. Ladder characters are not allowed to interact with non-ladder characters and vice-versa. This encouraged a lot more cooperative gameplay initially, but as items were duped and servers clogged, gameplay declined over time.
The first of the ladder seasons began with the initial release of Patch 1.10 in October 28, 2003.
After seeing how the first season went down, Blizzard decided to perform its first ladder reset on July 7th, 2004 with a promotional contest called "When Worlds Collide," as World of Warcraft was scheduled to be released the following year. The contest began for all users that had a legitimate registered account (for recovery) for all 5 Realms, and it was a ladder race to be the first to reach level 99. The first character to reach level 99 on the ladder, regardless of being on classic or expansion, hardcore or not, would be awarded a prize containing a Blizzard T-Shirt, a signed copy of World of Warcraft Collector's Edition, a toy statue, and a Blizzard North CD Wallet. The Ruststorm program was run during this season once, and several users complained that their items had been erased unfairly. This season also introduced several new exclusive "ladder-only" Rune Words later after the ladder race had come to an end just before 2005.
The second reset of the ladder took place on August 8th, 2005, just after patch 1.11 was released, and it also introduced the "Warden" anti-cheat system to Diablo 2. Unlike Season 2, Season 3 did not have a contest, and furthermore, thousands of accounts got permanently banned for using 3rd-party software from Maphacks to Bots. This did not stop bots indefinitely however, as programmers redesigned them to circumvent the "Warden" using different methods. There weren't any new "ladder-only" runewords during this season.
With patch 1.11 and the Third Ladder Season, Blizzard added a new area called Über Tristram which can only be accessed on Battle.net. Players can gain access to Über Tristram by killing designated monsters and following a series of sub quests. Inside Über Tristram enemies have extremely heightened defense, damage and resistances. Three über bosses, Pandemonium Diablo, Über Baal and Über Mephisto can be found inside Über Tristram and upon killing the last of the three Über Bosses, players receive a valuable Hellfire Torch Large Charm and a Standard of Heroes, which is an ornamental trophy and nothing more. The Über bosses provide a challenge to the high level characters that face them.
The third reset took place On June 25th, 2007, and not much changed from Seasons 3 and 4. However, an exploit was discovered that made going to the Forgotten Sands to get Baal's Eye by sending a special packet to the server. This consequently allowed non-expansion or classic characters to enter Act V provided they had a copy of Diablo 2: Lord of Destruction installed. This method was patched in mid-February 2007, along with a patch that would end games if anyone's ping passed a certain threshold. This prevented a common lag-based item duplication method. This generally increased the quality of gameplay, as the number of people attempting to lag the servers to execute the method greatly reduced. However, this caused many players to drop from games unexpectedly. Even after Blizzard attempted to stop duping with the server-side patch, many people have still figured out ways to dupe. Blizzard has yet to release a patch that stops duping permanently.
The fourth ladder reset took place on June 17, 2008, and patch 1.12 was integrated into Diablo II:Lord of Destruction. It allows the players to play without the CD if the game is "Full Installed". No other significant changes have been reported with the release of the patch at this time.
The fifth ladder reset took place on March 23rd, 2010, and patch 1.13 was integrated into Diablo II:Lord of Destruction. It included Essences required to make a Token of Absolution and stat/skill point resets.
The sixth ladder reset took place on September 28th, 2010. There have been no changes since the last patch/season.
The seventh ladder reset took place on March 28th, 2011. There have been no changes since the last patch/season.