The early years of the National League were tumultuous, with threats from rival leagues and a rebellion by players against the hated "reserve clause", which restricted the free movement of players between clubs. Early competitor leagues formed regularly and also disbanded regularly. The most successful was the American Association (1882–1891), sometimes called the "beer and whiskey league" for its tolerance of the sale of alcoholic beverages to spectators. For several years, the NL and American Association champions met in a postseason championship series—the first attempt at a World Series. The two leagues merged in 1892 as a single 12-team NL, but the NL dropped four teams after the 1899 season. This led to the formation of the American League in 1901 under AL president Ban Johnson, and the resulting bidding war for players led to widespread contract-breaking and legal disputes.
The war between the AL and NL caused shock waves throughout the baseball world. At a meeting at the Leland Hotel in Chicago in 1901, the other baseball leagues negotiated a plan to maintain their independence. A new National Association was formed to oversee these minor leagues. While the NA continues to this day (known as Minor League Baseball), at the time Ban Johnson saw it as a tool to end threats from smaller rivals who might expand in other territories and threaten his league's dominance.
The MLB is now comprised of the American (AL) and National (NL) Leagues. Since 1903, shortly after the American League entered professional baseball, the AL and NL champions play in the World Series at the end of every season.
For the first 96 years, the two leagues only competed against each other in exhibition games or in the World Series. Beginning in 1997, interleague games have been played during the regular season and count in the standings. As part of the agreement instituting interleague play, the designated-hitter rule is used only in games where the American League team is the home team.