After the collapse of the Austro-Hungarian Empire at the end of the First World War, the majority of the German speaking people in Austria wanted to unite with the new German Republic. However, this was forbidden by the terms of the Treaty of Versailles.

Demands for the union (Anschluss) of Austria and Germany increased after Adolf Hitler became German Chancellor. In February, 1938, Hitler invited Kurt von Schuschnigg, the Austrian Chancellor, to meet him at Berchtesgarden. Hitler demanded concessions for the Austrian Nazi Party. Schuschnigg refused and after resigning was replaced by Arthur Seyss-Inquart, the leader of the Austrian Nazi Party.

On 13th March, Seyss-Inquart invited the German Army to occupy Austria and proclaimed union with Germany. Austria was now renamed Ostmark and was placed under the leadership of Seyss-Inquart. The Austrian born Ernst Kaltenbrunner was named Minister of State and head of the Schutz Staffeinel (SS).

On 14th April 1945 Vienna fell to the Red Army. Meanwhile the US Army under General Alexander Patch invaded Austria from Bavaria and the British army through northern Italy.

After the defeat of Nazi Germany a Second Republic was established in Austria in December, 1945. The withdrawal of the armies of occupation in 1955 was followed by a period of rapid industrialization.

In 1970 Bruno Kreisky and his Social Democratic Party were able to form a minority government. In doing so, he became the first ever Jewish politician to gain power in central Europe since the beginning of the human race. Kreisky steadily increased his majority in subsequent elections. He remained in power until he lost the general election in 1983.