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The Union of Crowns refers to the crowning of King James VI of Scotland as James I of England in 1603, following the death of Queen Elizabeth I. This was the first time the Kingdoms of England and Scotland were united, the state being called the "United Kingdom of Great Britain" in Royalist circles and considered so by the British Royal Family of Stuarts. The general sentiment of a United Kingdom was already underway, with the "Union Jack" flown at sea.
The two Parliaments remained separate, but Whig history has deemed that this state did not exist before the Parliament of Great Britain and the Act of Settlement 1701. The Settlement extricated all traces of Roman Catholicism and former dynasties from the old kingdoms, paving the way for a purely "Protestant Great Britain" which was separated from historical precedent and it was thought this arbitrary aspect would stifle factionalism.
Aside from religious aspects, this entire process was inspired by the resultant United Kingdom of Spain by marriage of Ferdinand II of Aragon and Isabella of Castile. It was because of the Jesuit aspect of this character (tied to the Spanish Inquisition and English interests in Holland), that the philohispanic politics of James was repellant towards the Puritans . This would uphold the Triumphant perception of Protestantism and almost completely eradicate the memory of King Philip II of Spain as equal monarch with Mary I of England--unlike their consideration for William and Mary.
One other factor in the dubious quality of a "united kingdom" prevailed; that appellation of monarchs considered "King/Queen of Scots" rather than "King/Queen of Scotland". The Scottish kingdom was not as formal as England, or other Continental nations of that time. Many considered "Scotland" to be a notional idea of Scots as equals with England, which was never completely fact on the international scene until perhaps the reigns of William and Mary. This distinction did not last long, for Queen Anne was inaugurated by a United Parliament once and for all as the prevailing and historic official designation "King/Queen of Great Britain". In any case, this original union was in reference to England and the Scots (or Scotland) --as opposed to the latterly unpopular and rather failed union of the Hanoverians with the Kingdom of Ireland and Parliament of Ireland.
James called Great Britain an "imperial dominion", which is a sort of title rejected later on by George III of the United Kingdom (See British Emperor#George_III_rejects_the_idea_of_being_called_Emperor). The reign of James is normally seen as the start of a united "Great Britain" and the "British Empire" as a polity and conscious identity, although most see the Tudor dynasty to largely have begun this impetus (with the annexation of Wales and creation of an independent church, Cabot's reconnaissance and Elizabethan colonies).
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