The Treaty of Novgorod aimed to delineate borders between Norway and Russia, particularly focusing on the northern Finnmark territory. The treaty emerged after prolonged negotiations, as both nations sought to address territorial disputes that had arisen due to overlapping claims in the region, a consequence of expanding influences and interests in Northern Europe. This diplomatic agreement involved envoys dispatched from both kingdoms, who engaged in discussions to ensure mutual recognition of each other's territorial claims and rights.

The significance of the treaty extends beyond mere demarcation; it symbolized a shift towards more structured diplomatic relations between the two countries. By clearly defining borders, the treaty aimed to reduce conflicts over land and resources, which were vital for both nations. Additionally, the establishment of recognized borders facilitated trade, allowing for smoother economic interactions and fostering a spirit of cooperation that benefited both kingdoms during an era marked by feudal conflicts and shifting power dynamics.

Furthermore, the treaty established a precedent for future negotiations concerning territorial disputes in the region. It represented an early example of formal international diplomacy that allowed Norway and Russia to coexist without further territorial conflict, setting a tone for subsequent agreements in the region. The treaty’s implications were felt not only in Finland but also influenced broader relationships across Northern Europe, as it highlighted the importance of dialogue and negotiation in resolving disputes over land.