The Dawn Rebellion

A historical period that lasted over a century, in which the various subjugated races of demihumantiy rebelled against their Dragonlord captors.  This was a period of prolonged guerilla warfare, sabatoge, and betrayals on all sides.  
Eventually the Imperial Elves, with their master of arcane magic and newfound anitech, were able to turn the tides.  Most of what the races know of arcane magic today can be traced back to what was learned from the Imperial Elves during this time.