In 965 A.D., the Asgardians battled the Frost Giants on Jotunheim during the Asgard-Jotunheim War, ultimately winning the fight. Odin made a truce with Laufey, leader of the Frost Giants and confiscated the Casket of Ancient Winters. He also took an abandoned baby and adopted him, naming him Loki which was revealed much later.
During Thor's - Odin's biological son - coronation, the truce was seemingly broken when the Frost Giants entered Odin's Vault and tried to steal the Casket of Ancient Winters, but not before the Destroyer interfered and thwarted the theft. Thor, enraged then swore revenge on Jotunheim and gathered Loki, the Warriors Three, and Lady Sif to accompany him on the journey to Jotunheim. Thor then asked Heimdall to keep it a secret and then Heimdall transported them all to Jotunheim.
- "At least make it a challenge for me!"
The Asgardians walked through the desolated and frozen lands of Jotunheim without meeting any single enemy. They eventually were confronted by Laufey, the leader of the Frost Giants. Although he felt challenged by the Asgardians coming to his very homeworld, Laufey was willing to let them go without a fight, declaring that the consequences of a battle between Asgard and Jotunheim would be too much to deal with. Loki urged Thor to accept the offer as they were surrounded by Frost Giants and Thor nearly agreed, but after one Frost Giant taunted him, Thor killed him with Mjølnir, opening the hostilities.
A fierce battle ensued between the Asgardians and the Frost Giants. Although Thor enjoyed the battle, easily defeating his foes, his allies were soon overrun by hordes of Frost Giants. While Volstagg's arm was frozen upon being touched by a Frost Giant, Loki's skin simply turned to blue, similarly to a Frost Giant's skin, before returning to normal. When Fandral got skewered by an ice spears, Sif decided to retreat while Thor kept fighting the Frost Giants.
As the Asgardians were fleeing, Laufey summoned a Jotunheim Beast to chase them. Upon seeing this, Thor caused a massive thunderbolt which collapsed vast parts of Jotunheim's lands, killing dozens of Frost Giants. However, the Beast clung to the floor thanks to his claws and kept chasing the Asgardians. As they reached the edge of a cliff, the Jotunheim Beast emerged from the other side only to be killed by Thor who threw himself in his mouth at full speed, driving a giant hole in the Beast's throat. However, the Asgardians were still surrounded by an army of Frost Giants, without an escape as Heimdall would not open the Bifrost Bridge facing such danger.
The Asgardians were eventually saved by the arrival of Odin, who had been warned of the attack. Odin tried to negotiate a truce with Laufey, stating that Thor had only been childish, but Laufey refused to forgive such an offense and moved forward to attack, prompting Odin to teleport away back to Asgard with his fellow Asgardians and a new war to deal with.
Loki later revealed that he had informed a guard of their journey to Jotunheim, who in turn told Odin. After the fight and the contact with the Frost Giant, Loki began to suspect about his true heritage as he did not suffer from any frostbite contrary to Volstagg. Loki raged to Odin about this fact, which caused Odin to fall into the Odinsleep.