Part 2: The Second Age
At the beginning of the Second Age, Elrond dwelt in Lindon with Gil-galad, the High King of the elves in Middle-earth. During the Second Age, Sauron, Morgoth's lieutenant, re-emerged in Middle-earth. At first he took on a fair form, posing as an emissary of the Valar. He deceived many elves including the elven-smiths of Eregion, who forged the rings of power - save for the One Ring, forged by Sauron himself. However, Elrond and Gil-galad distrusted Sauron from the beginning, and he was never welcome in Lindon.
In II.1695 Sauron invaded Eriador, and Gil-galad sent out army under the command of Elrond. Although they were joined by another force under Celeborn, this army was unable to withstand Sauron's attack, and Elrond was forced to retreat northwards. In a hidden valley west of the Misty Mountains he established the stronghold of Rivendell in II.1697. Sauron kept Rivendell under siege, and it remained the only part of Eriador to withstand Sauron until arrival of Númenorean forces in II.1700 when Sauron was driven back. The army besieging Rivendell was then destroyed by the combined forces of Elrond and Gil-galad.
After Sauron was driven back to Mordor, the First White Council was held (a forerunner of the White Council established in the Third Age), with Elrond among its members. At this time it was agreed that Rivendell would be maintained as the Elven stronghold in the east. According to a note in the Unfinished Tales, it may also have been at this time that Gil-galad gave Vilya to Elrond.
Sauron, however, was not yet defeated, and gradually rebuilt his power in Mordor. In II.3429 he began a new assault on Middle-earth. In II.3430, Elendil and Gil-galad forged the Last Alliance, and marched east gathering a host of elves and men. They halted for a while at Rivendell, then crossed Misty Mountains to Dagorlad. Elrond marched with Gil-galad, as his herald. In II.3441 Sauron was defeated when Isildur son of Elendil cut the One Ring from his hand, though both Elendil and Gil-galad perished in the battle. Elrond and Círdan counseled Isildur to destroy Ring, but he determined to keep it.
With the defeat of Sauron, the power of the three elven rings could be revealed, and at the end of the Second Age, the elves perceived that Vilya, the Ring of Sapphire, was kept by Elrond in Rivendell.
Part 1: The First Age | Part 3: Elrond and Celebrían | Part 4: The Heirs of Isildur | Part 5: The Return of the Shadow and the End of the Third Age