Daniel is the key to understanding the book of Revelation.
The great image in Daniel 2 represents specific kingdoms that have a part to play in prophecy from Babylon forward. These same kingdoms are represented in Daniel 7 as beasts.
Daniel actually identifies the first three consecutive kingdoms in his book. Babylon, Medo-Persia and Grecia. If the first three kingdoms are consecutive, it then makes sense that the fourth kingdom is also consecutive and the one that history records after Grecia. That kingdom would then divide into ten kingdoms as the prophecy says, and the little horn would be seen coming up among them and plucking up three of the ten kingdoms by the roots.
Daniel 7 gives a time prophecy that is echoed in Revelation 13 as 42 months concerning the little horn; that it would be in power for 1260 years and then lose its power (the deadly wound). This can also be seen in historical events.
The beasts described in Daniel 7 are found in the description of the beast that rises out of the sea in Revelation 13:1-10, which points to the fact that the sea beast is none other than the little horn of Daniel 7 that will have its deadly wound healed and recover the power it lost at the end of the 1260 year prophecy.
We're now waiting for the sea beast to have its deadly wound healed completely and come into power, triggering the final events that bring in the mark of the beast (with the help of the earth beast; Revelation 13:11-18) and the second coming of Christ.
I recommend Daniel and the Revelation written by Uriah Smith (
PDF,
MP3). It covers everything in detail.