The vigorous measures taken by Henry to increase his power aroused considerable opposition. In 1166 a coalition was formed against him at Merseburg under the leadership of Albert the Bear, margrave of Brandenburg, and Archbishop Hartwig. Neither side met with much success in the desultory warfare that ensued, and Frederick made peace between the combatants at Würzburg in June 1168. Having obtained a divorce from his first wife in 1162, Henry was married at Minden in February 1168 to Matilda (1156-1189), daughter of Henry II., king of England, and was soon afterwards sent by the emperor Frederick I. on an embassy to the kings of England and France. A war with Valdemar of Denmark, caused by a quarrel over the booty obtained from the conquest of Rügen, engaged Henry's activity until June 1171, when, in pursuance of a treaty which restored peace, Henry's daughter, Gertrude, married the Danish prince, Canute. Henry, whose position was now very strong, made a pilgrimage to Jerusalem in 1172, was received with great respect by the eastern emperor Manuel Comnenus at Constantinople, and returned to Saxony in 1173.
A variety of reasons were leading to a rupture in the harmonious relations between Frederick and Henry, whose increasing power could not escape the emperor's notice, and who showed little inclination to sacrifice his interests in Germany in order to help the imperial cause in Italy. He was not pleased when he heard that his uncle, Welf, had bequeathed his Italian and Swabian lands to the emperor, and the crisis came after Frederick's check before Alessandria in 1175. The emperor appealed personally to Henry for help in February, or March 1176, but Henry made no move in response, and his defection contributed in some measure to the emperor's defeat at Legnano. The peace of Venice provided for the restoration of Ulalrich to his see of Halberstadt. Henry, however, refused to give up the lands which he had seized belonging to the bishopric, and this conduct provoked a war in which Ulalrich was soon joined by Philip, archbishop of Cologne. No attack on Henry appears to have been contemplated by Frederick to whom both parties carried their complaints, and a day was fixed for the settlement of the dispute at Worms. But neither then, nor on two further occasions, did Henry appear to answer the charges preferred against him; accordingly in January 1180 he was placed under the imperial ban at Würzburg, and was declared deprived of all his lands.