The first Inquisition was a group of people who, following the First Blight, rose up to defend Thedas from the dangers of magic and heretics. The Inquisition later allied with the Chantry, abandoning its original name and splitting itself into the Seekers of Truth and the Templar Order. In 9:41 Dragon, the Inquisition is reformed, following the cataclysmic event called The Breach.
The Inquisition of Old
In the years before the founding of the Chantry and the start of the Divine Age, Thedas was plunged into chaos. The First Blight had ended, the Imperium had broken apart following Andraste's March, and despite the spread of the Maker's teachings, blood mages and Old Gods cults were widespread. The Inquisition was formed around -100 Ancient with the goal of protecting the people from the "tyranny of magic" in whatever form it might take; blood mages, abominations, cultists or heretics. A loose association of Andrastian hard-liners, the group combed the land in search of these "threats" and some say theirs was a reign of terror. Others say they were cast in a negative light by history because their investigations and even application of justice, protecting both mages and common people impartially, crossed too many powerful groups. In these accounts it is suggested that the group was already known as the Seekers of Truth and that the "Inquisition" moniker was perhaps pejorative.
In 1:20 Divine, the newly founded Chantry found common cause with the Inquisition and they signed the Nevarran Accord. As part of the agreement, the Inquisition became the new martial arm of the Chantry, the Templar Order, and its senior members became known as the Seekers of Truth. Another result was the creation of the Circle of Magi, with the Templars serving as overseers for the Circle.
The last leader of the original Inquisition, Ameridan, went missing after the organisation's dissolution. It is said he left to hunt a powerful dragon or to not overshadow the newly created Templar Order.
When the Inquisition was no more, the mysterious Order of Fiery Promise rose up for the first time, claiming to be the real Inquisition and Seekers of Truth. They were quickly dispersed by the might of the newly established Chantry.
The Modern Inquisition
The modern Inquisition, in a fledgling state, begins with the interrogation of Varric Tethras by Seeker Cassandra Pentaghast. The Inquisition's reconstruction is, in fact, a back-up plan by Divine Justinia V in case of a calamity within the Chantry or if her attempt to restore peace between mages and templars failed. Justinia hoped that with enough support, the Inquisition could challenge the very tenets of the Chantry to enforce rights for mages. The Divine's servants searched for a worthy candidate to lead the Inquisition, such as the Hero of Ferelden or the Champion of Kirkwall, but they both had disappeared.
Following the massive explosion that killed the Divine and the Conclave, Thedas falls into chaos as the Breach threatens to consume the world. The late Divine's writ was invoked by her Hands, Cassandra Pentaghast and Leliana, declaring the Inquisition reborn and independent of Chantry authority. However, the Chantry has denounced the Inquisition, calling them heretics for harbouring the only survivor of the Conclave's explosion, who had been labeled the Herald of Andraste by witnesses from the failed conclave at the Temple of Sacred Ashes, when they were seemingly led out of the Fade by the prophet herself.
After either allying with the mage rebels, the Herald manages to seal the Breach. But the celebrations are cut short, as Haven comes under attack by Corypheus. The Herald distracts him long enough for the village to be evacuated before causing an avalanche to bury Corypheus' army and the village. When the Herald reunites with the survivors of Haven, the Herald leads them to Skyhold, where they are formally given the title of Inquisitor.
The Inquisition later leads a siege of Adamant Fortress to stop Venatori magister Livius Erimond from binding Grey Warden mages to Corypheus, enabling the darkspawn to control an army of demons. In the aftermath, the Inquisitor can either ally with the surviving Wardens or banish them from Orlais.
After the resolution of the War of the Lions, Orlais formally allies with the Inquisition and they march on the Arbor Wilds to purge the remainder of Corypheus' army. Unfortunately, Corypheus returns to the Temple of Sacred Ashes to reopen the Breach, forcing the Inquisitor to engage him without the support of the army.
With Corypheus' defeat, the Inquisition achieves renown throughout southern Thedas and the balance of power across Thedas is drastically changed, perhaps permanently.
By 9:44 Dragon, the Inquisition has come under pressure from both Orlais and Ferelden, the former wanted the Inquisition as another vassal, the latter wanting them to disband entirely. During the summit with the Exalted Council, the Inquisitor is drawn away to deal with a new Qunari threat that is spreading through the magical eluvians. Leliana discovers that several of the elves in the Inquisition's own ranks were Qunari converts from Kirkwall and covertly used the Inquisition to smuggle in gaatlok into the Winter Palace. Solas also reveals that his agents were embedded in the Inquisition as well.
After the resolution of the Qunari threat, the Inquisitor, having their own left arm magically amputated by Solas to prevent the Anchor from killing them, returns to the Exalted Council to decide the Inquisition's fate.
The Inquisitor re-structures the Inquisition: The Inquisitor felt that given the danger of the threats facing Thedas, the Inquisition was still needed but could not continue as it currently was in the face of increasing political pressure. Much like the first Inquisition did with the Nevarran Accord, the Inquisition reached an agreement with the Chantry. The Inquisition was downsized to a more manageable size and would serve as the personal honour guard of Divine Victoria, herself a former member of the Inquisition. This allowed them to launch a campaign against the looming threat to Thedas, that was capable of an effective response but at a higher risk of infiltration. To attempt to compensate for this, the Inquisition began screening recruits and members much more vigorously.
Hierarchy and Organization
The re-formed Inquisition is commanded by the Inquisitor who serves as overall leader of the organization. Beneath them are the three advisers, each of whom oversees a different department of the Inquisition. The Commander leads the military forces of the organization and oversees training. The Seneschal/Spymaster is in charge of covert operations, subterfuge and liaisons with more disreputable elements. The Ambassador is in charge of co-coordinating diplomatic efforts among the nobility and various other groups which the Inquisition must work with.
The Inquisition is less rigid than most organizations in Thedas and adopts a more inclusive recruitment practice, allowing not only humans but elves, dwarves and Qunari into senior command positions, similar to the Grey Wardens. Unlike the Wardens however, the Inquisition does not strive to be a-political, as much of its financial and diplomatic backing comes from senior members of the Orlesian nobility as well as the Fereldan nobility.
After reaching an agreement with the Chantry at the Exalted Council, the Inquisitor continues to serve as leader of the Inquisition and maintains the same basic structure but on a smaller scale and now are accountable to Divine Victoria.