The rock band Balkandji was founded in the fall of 1999 by Nikolay Barovsky (keyboards) and Kiril Yanev (guitars). The idea for the style as well as for the foundation of the group was a result of long experimentation and joint work of the two in the field of musical synthesis between traditional rock music and elements from the Bulgarian folklore. The first song of the band - "Az tebe, libe, sum zaljubil" was inspired by the poet Kosio Nikolov who offered them to write a song based on one of his poems. The demo version of the song was recorded at Kiril Yanev's home. In 2000 the band participated with this song in the "Spring 2000" contest of the National radio "Horizont". In the mean time, as a side project, the group participated with two children songs in the contest "Parad na detskata pesen". The songs - "Vyatura" ("The Wind") and "Staryat Prizrak" ("The Old Ghost") won first and second place in the contest.

The activity of the group increased further as Alexander Stoyanov (drums & percussion) and Vladimir Leviev (bass) joined the team. Paralel to composing and recording of the demos for their first album, the group again entered the spring contest of the National radio “Horizont" - “Spring 2001” with the song “Krali Marko", which climbed to number one. In the same year the song “Kum taz Zemya”("To This Earth") won second place in the contest “My reason to stay in Bulgaria”. In the fall of 2001 another side project of the group, again making use of folklore elements but this time based on electronic music, won third place in the contest "Computer Space 2001".

The opera singer Inna Zanfirova joined the group in November 2001. Thus the style of the group was finally defined—original music based on synthesis of folklore and heavy rock music. In the mean time the work on demo record for the first album "Probujdane" ("Awake") was concluded. Provoked by the offer to participate in a concert on November 29, 2001, Spas Dimitrov (guitar), Nikolay Traikov (drums) and Hristo Pashov (bass) joined the group since at that time Alexander Stoyanov and Vladimir Leviev were studying abroad.

In 2002 Nikolay Barovsky and Kiril Yanev decided to produce the album on their own, because at the time the producers' interest in this kind of music was low. Since then more than 1000 copies were sold. The band began regular live appearances as part of the program of the club for original music “Î!Shipka”. The percussionist Kalin (Katzko) also joined the group. The first appearance of the group outside Sofia (August 2002) was in the festival "Sluntze-Luna 2002" in the village of Trigrad. During the whole year the band toured the country as well as regularly performed in the club “Mishenata” in Sofia.

In 2003 the band recorded the song “Oi, Mari, Yano”, which was included in the CD compilation “Î!Shipka” produced by “Toxity Records”. In addition to the regular appearances in the club for original music the group also participated in a number of summer festivals including The Rockers' Fest in the village of Debnevo, the "Sluntze-Luna" Festival in the village of Trigrad, etc. The recording of a second album - a co-production between “Balkandji” and “Toxity Records”- began but its release was delayed due to unfavorable market conditions.