Nietzsche's The Birth of Tragedy from the Spirit of Music is one of the most important contributions ever made to our understanding of Tragedy as an art form. Nietzsche returns in his book to the roots of tragedy with ancient Greeks and their Festival of Dionysus, at which the great tragic plays of Aeschylus, Sophocles, and Euripides were performed. He proposes that through the tragic theatre, the Ancient Greeks found a solution to nihilism, or a way of "justifying life" in the face of all its terrors and horrors. For this reason, Nietzsche believed Tragedy to be the highest form of art.
He explains a contrast in life, and in the tragic theatre, between the "Apollonian" and the "Dionysian". Loosely, the Apollonian is the realm/reality of sobriety and the differentiation of boundaries, while the Dionysian is a realm/reality of total unity, and ecstasy in which boundaries between people and things dissolve. Life, he believes, is a constant battle between the two, and in the tragic theatre, it is the singing of the chorus that represents the Dionysiac while dialogue and other action represented the Apollonian. The mixture of the two in the tragic theatre allowed spectators to experience life, and the human condition through watching tragedy.
Nietzsche explains that the Dionysian consciousness has two sides. While it can be a kind of universal brotherhood, it can also be dangerous, wild, and destructive. The Greeks, he suggests, were saved from this kind of barbarity by their ability to draw boundaries though the Apollonian - it was these boundaries that allowed Ancient Greek civilization to form.
Tragedy, as the title of the book suggests, was born out of music in Ancient Greece. Actors were added only later to tragic performances. Thus, Nietzsche argues that though the audience would empathize to some degree with the tragic hero, their primary identification was with the chorus. This split between identification with the chorus (the Dionysiac) and the actors (the Apollonian) produces a tension in tragedy through which the audience is able to feel tragic joy, or what Aristotle termed "catharsis". Through sympathy with the tragic hero's plight and downfall, the audience too begins falls towards destruction.
However, because the audience identifies first and foremost with the chorus, Nietzsche argues that they are able to experience the ecstatic Dionysian reality of the self actually being part of one whole unity that can survive the destruction of one single individual just as a waterfall would survive the destruction of single rain drops. Through this experience, we as audience members are comforted even in the face of terrible pain and suffering.
Too much of this ecstasy, however, would descend into dangerous intoxication and barbarity. We are unaware why we are comforted watching tragedy because we are shielded by the Apollonian surface of the work that deceives us into believing that tragedy is about the fate of an individual in a world of other individuals. When the Ancient Greeks left the theatre, argues Nietzsche, they felt "strangely comforted" and yet "ready for action".
Nietzsche claims that in the hands of Euripides, who was writing after Aeschylus and at the same time as Sophocles, tragedy (as he defines it) died. He argues that "Socratism" entered his work, with Socratism being a view that reality is Apollonian all the way down, meaning that in theory, science and technology are capable of solving every problem in the world. If this is true, then there is no need for any kind of "metaphysical comfort" that one finds in the experience of the Dionysian. Nietzsche argues that modern culture is based on this kind of illusion, failing to realize that pain and mortality are as inseparable from our lives as for the Ancient Greeks. He suggests that we need a rebirth of tragedy, and says that we might find it in the form of Wagner's music dramas - a man whom Nietzsche was friends with and greatly admired.