The movement toward German unification began in the first half of the 19th century. Once completed, its impact on the course of European history was immeasurable. The trend toward unification began with a power struggle between the two most prominent German states, Prussia and Austria, each seeking to control a unified Germany. Prussia eventually emerged victorious and became the dominant state in the unified Germany.
The first serious modern attempt at unifying the German states commenced in 1815, when an Austrian-dominated confederacy was established. However, the economic power of Prussia, Austria's rival, was increasing at this time, due to unprecedented iron and coal production, and the benefits reaped from Europe's growing railway network. This network, along with the foundation of the German Customs Network (also known as the Zollverein) in 1834, was instrumental in binding the German states closer together. Significantly, Prussia's maneuvering resulted in Austria being completely excluded from the Zollverein.
The German confederation was cast into uncertainty by the revolutions besieging Europe in 1848, yet, by the 1850s, Prussia had clearly emerged as the dominant economic power. Furthermore, Prince William of Prussia had set his sights upon a Prussian-led union after his investiture as Regent in 1858. To this end, he appointed Otto von Bismarck as Chancellor, a man who earned the title of "iron chancellor" for his tremendous strength of will. In 1864, Bismarck led a combined German force, including both Prussia and Austria, to victory over Denmark in a conflict over the contested provinces of Holstein and Schleswig. Afterward, Austria attempted to assert independence from Prussia. Bismarck responded by declaring war on Austria, conquering Prussia's rival by 1866, and founding the new North German Confederation. In addition to Prussia and Austria, this union included Schleswig, Holstein, Alsace-Lorraine, and Westphalia, as members and it continued to maintain the economic power that Prussia had established for itself. The North German Confederation maintained the trade links with the remaining German states provided by the Zollverein and it set up favorable trade relations with England, Belgium, France, and Italy. The economic prosperity enjoyed by the Confederation soon drew the remaining German states, including Thuringia, Saxony, Wurttemburg, and Bavaria, into the union.
Throughout the formation of this Confederation, Bismarck was able to ensure Prussian dominance within a united Germany. In effect, the Prussian army became the new German army and the Prussian chancellor became the prime minister of Germany. Most significantly, the Prussian king was elevated to the title of German Emperor in 1871. Although the achievement of Prussian dominance within the Confederation was one of Bismarck's greatest accomplishments, the unification of the German states into a single large nation is perhaps most significant because it transformed Germany into an important world power of both the 19th and 20th centuries.