The treaty, negotiated at Phoenice in Epirus, brought a formal close to the First Macedonian War between Rome and Philip V of Macedon. Rome, distracted by its life-or-death struggle against Hannibal in Italy, accepted modest terms, but the peace proved temporary, setting the stage for further Macedonian Wars that would eventually bring Rome into direct control of Greece.
The war had begun almost as a sideshow to Rome's desperate fight against Carthage. Philip V allied with Hannibal in 215 BC, hoping to expand Macedonian influence in the Adriatic while Rome was consumed fighting for its survival in Italy. Rome, unable to spare significant forces, fought largely through allies like the Aetolian League and a small naval and diplomatic presence.
By 205 BC, both sides had reasons to want peace. Rome needed to concentrate entirely on defeating Hannibal, and Philip had gained less than he'd hoped and faced restless allies. The resulting Peace of Phoenice let Rome disengage from a costly secondary front and Philip keep some of his Illyrian gains.
The peace was really just an intermission. Within a decade, Rome, having crushed Carthage, turned its full attention eastward, and the Second Macedonian War erupted in 200 BC. Macedon's defeat there began a process that ended in 168 BC with Rome's total domination of Greece, showing how this first, almost accidental war set in motion Rome's eventual absorption of the Hellenistic world.