The Origin of Prague
The origin of Prague goes back to the 7th century and the Slavic princess Libuše, 
  a woman of great beauty and wisdom who possessed prophetic powers. Libuše 
  and her husband, prince Premysl, ruled peacefully over the Czech lands from 
  the hill of Vyšehrad. A legend says that one day Libuše had a vision. 
  She stood on a cliff overlooking the Vltava, pointed to a forested hill across 
  the river, and proclaimed: "I see a great city whose glory will touch the 
  stars." ("Vidím mesto veliké, jehoz sláva hvezd 
  se dotýkati bude."). She instructed her people to go and build a 
  castle where a man was building the threshold (in Czech práh) of a house. 
  "And because even the great noblemen must bow low before a threshold, you 
  shall give it the name Praha". Her words were obeyed and some two hundred 
  years later, the city of Prague became the seat of the Premyslid dynasty.
  The Story of Horymír and Šemík
When the Czech lands were ruled by prince Kresomysl, a farmer named Horymír 
  lived in the village of Neumetely. He had a white horse of extraordinary intelligence 
  called Šemík. Due to Kresomysl's obsession to find treasures that 
  were said to be hidden underground, people were encouraged to abandon farming 
  and to become miners. Horymír was unhappy with Kresomysl's rule and warned 
  that neglecting farming would result in famine. His protests were not liked 
  by the miners who one day set Horymír's property on fire. Horymír 
  and his followers in turn burned down the miners' village. Horymír was 
  punished and sentenced for execution. When he was asked his last wish, he requested 
  one last ride around the castle grounds on his beloved horse Šemík. 
  His wish was granted. When Horymír got on his white horse, he whispered 
  something in his ear. Šemík ran to the ramparts, jumped over them 
  and slid down the cliff. When the on-lookers got to the ramparts, they were 
  astonished to see Horymír and Šemík on the other side of 
  the Vltava, galloping towards Neumetely.
The miraculous jump exhausted Šemík. The dying horse spoke to Horymír 
  in a human voice and asked for a tomb to be built for him. Horymír did 
  as the horse wished. The tomb has since disappeared but Šemík is 
  said to be sleeping in the Vyšehrad rock, ready to come out when his help 
  is needed again.

The ruins of Vysehrad and the Vltava river (Prague)
  The Golem of Prague
In the 16th century, during the reign of Rudolf II, an old Jewish man named 
  Rabbi Judah Loew lived in Prague. During that time, the Jewish people of Prague 
  were being attacked and lived their lives in fear. Rabbi Loew decided to protect 
  the Jews against pogroms by creating the Golem, a giant who according to the 
  Cabala could be made of clay from the banks of the Vltava. Following the prescribed 
  rituals, the Rabbi built the Golem and made him come to life by reciting a special 
  incantation in Hebrew. The word "emet", meaning "truth", 
  was placed on the Golem's forehead.
The Golem would obey the Rabbi's every order and would help and protect the 
  people of the Jewish Ghetto. However, as he grew bigger, he also became more 
  violent and started killing people and spreading fear. Rabbi Loew was promised 
  that the violence against the Jews would stop if the Golem was destroyed. The 
  Rabbi agreed. By removing the first letter from the word "emet", thus 
  changing it to "met" (meaning "death"), life was taken out 
  of the Golem. According to legend, the Golem was brought back to life by Rabbi 
  Loew's son, and may still be protecting Prague today.
  Prophecies of the Clock
One day a prisoner, looking at the famous astronomical clock, noticed that 
  a sparrow was caught in the mouth of Death. The unlucky man believed that sight 
  to be a bad omen and thought that he would spend the rest of his life in prison. 
  But, as the next hour stroke, the clock started moving again, the jaw of Death 
  opened and, to the prisoner's great relief, the sparrow set itself free and 
  flew away. A few days later the convict was released from prison and was free 
  again.
  The Legend of Dalibor (Dalibor's Violin)
The name of the Tower of Dalibor (Daliborka) at the Prague Castle is connected 
  to one of Prague's best-known legends, which was also made into an opera by 
  Bedrich Smetana in 1868.
According to this legend, a man called Dalibor from Kozojedy, a small town 
  near Litomerice, was sentenced to death and imprisoned in this tower for giving 
  shelter to some rebellious peasants. While waiting for the fatal day, Dalibor 
  would play his violin and his music was so beautiful that all the people of 
  Prague were moved and enchanted and the local authorities didn't dare announce 
  the date of the execution. People knew that the generous Dalibor was dead when 
  his violin fell forever silent.
  The Silver Fish
A legend says that a wealthy man called Myslík was forced to run away 
  from Prague after the battle of the White Mountain. He gathered all his precious 
  silver and melted it in a fish-shaped clay mould. Before leaving his beloved 
  Prague, Myslík hid the silver fish inside a wall of his house. Many years 
  later a new tenant was living in that house. One day, this man was ordered by 
  the city counselors to tear down the old building and build a new one. The poor 
  man fell into despair at the news as he didn't have the money to do that. He 
  was about to leave his house when Myslík's silver fish fell out of a 
  broken wall. The precious object allowed the man to restore his old house. This 
  legend is still well known in Prague and the moral of this story is that someone's 
  misfortune may always turn into someone else's good luck and so we should never 
  lose our hope.