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Austria is a primarily German state in Central Europe.
Early 16th Century Religious Turmoil
With the rise of Lutherism in the 16th century, Austria became increasingly disunited. Many of the peasants rejected Catholicism as a feudalistic religion keeping them down, and converted to Lutherism. Ferdinand I, ruler of Austria, was an ardent Catholic and fought to keep Austria faithful to Rome. In 1526 the Czechs, under Vladistoc I invaded Austria. The Austrians, facing internal strife over the question of Protestantism and Catholicism, could not muster a sizable army to defend against the invaders. The Czechs, occupying most of the Eastern portion of the country, made a treaty with the Ferdinand I. He would deliver much of the eastern half of Austria (including Vienna) to the Czechs, and in return they would help him defeat the Lutherans. This is somewhat a puzzle to historians, as Vladistoc I was, although Hussite, a supporter of the Lutheran movement. Because of the Czech involvement, Catholocism was to remain the majority in Austria.
Inheritance of Czech Lands
In the 1570s, despite their losses in 1526, Austria controlled a sizable portion of territory in Central Europe. In 1579, the Czech Parliament elected Charles V, ruler of the Holy Roman Empire and emperer of Austria to the throne of Čechy. The gain of such large amounts of territory vastly strengthened him as the Holy Roman Emperor, and would allow him to put many of the lesser nobles in Germany back into their places. On the flip side, however, the Czech Empire, including Eastern Austria, was primarily Lutheran, and furthered the religious divide in the Holy Roman Empire.
20 Years War
In 1623, the Twenty Years' War, ignited by the burning of a Catholic church in Prague, began throughout the Holy Roman Empire. Phillip III, the king of Austria, severely depleted his treasuries to finance the war. At the Treaty of Paris, many of the North German Princes were allowed to leave the Holy Roman Empire, vastly weakening the power of Phillip III.