In 1804 the Austrian Empire (German: Kaisertum Österreich) was formed by Holy Roman emperor Francis II (who became Austrian emperor Franz I), although the Holy Roman Empire itself came to an end in 1806 as a result of the Napoleonic Wars. Despite many defeats at the hands of the French during the Napoleonic Wars, the Austrian Empire eventually emerged on the winning side, and played an important part in that victory, and ended up, together with Prussia, being a leading member of the German Confederation.
In 1864, Prussia and Austria cooperated in a war against Denmark in order to free the Dutchies of Schleswig and Holstein from the Danish Crown. However, following the war, the two countries could not agree on how these provinces hould be administered, and the Prussian-Austrian War of 1866 was a result. As a result of its defeat in this war, Austria had to leave the German Confederation, and end its participation in German politics.
In 1867, the Ausgleich ("Compromise") was signed by emperor Franz Joseph and a Hungarian delegation led by Ferenc Deák. The Ausgleich provided for a Hungarian government of near equal status to the Austrian government in Vienna, presided over by a single monarch (Franz Joseph) who had responsibility the military and foreign policy. This arrangement was known as the "dual monarch", and by this arrangement the Austrian Empire became the Austria-Hungary.
The 1914 assassination of the Austrian Archduke, Franz Ferdinand, in Sarajevo, was the trigger that led to World War I. Austria-Hungary was among the defeated Central Powers, and the Empire broke up along ethnic lines. The German speaking parts of the Empire became the Republic of German Austria (German: Republik Deutschösterreich), but the name was changed at the insistence of the Entente powers to the Republic of Austria (German: Republik Österreich). The new state was also forbidden to ever unite with Germany.
The First Austrian Republic came to an end in 1933, when the Chancellor, Engelbert Dollfuß, shut down parliament and established an authoritarian regime in an attempt to stabilize the country - paramilitary armies belonging to the Social Democrats and Conservatives were fighting each other on the streets, and a growing Nazi movement was advocating union with Germany.
Engelbert Dollfuß was assassinated in 1934, during an attempted Nazi coup, and succeeded by Kurt Schuschnigg. In 1938 however, German troops marched into Austria, and Adolf Hitler (who himself was Austrian) proclaimed the "Anschluss", the annexation of Austria into Greater Germany.
At the close of World War II, with the defeat of the Nazi regime, Austria, like Germany, was divided into American, British, French and Soviet Occupation Zones. However, just before the surrender, Austrian politican, Karl Renner, declared the separation of Austria from Germany, and set up a Provisional Government in Vienna. This government was in fact recognized by the Allies, and as a result, Austria was treated as the first victim of the Third Reich.
In 1955, as a result of the Austrian State Treaty (German: Österreichischer Staatsvertrag) , the country regained its independence. As part of the agreements surrounding this treaty, Austria became permanently neutral, a status which it maintains to this day. Austria joined the European Union in 1995, and became part of the Eurozone which it was established in 1999.
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