Sigismund, who died in December 1437, was succeeded on the German throne and also in Hungary and Bohemia by his son-in-law Albert of Austria, and from this time, although remaining in theory elective, the German crown was always conferred upon a member of the house of Habsburg until the extinction of the male line of this family in 1740. The reign of Albert II. was too short to enable him to do more than indicate his good intentions; he acted in general with the electors in observing a neutral attitude with regard to the dispute between the council of Basel and Pope Eugenius IV., and he put forward a scheme to improve the administration of justice. He died in October 1439, and was succeeded by his kinsman Frederick, duke of Styria, who became German king as Frederick IV. and, after his coronation at Rome in 1452, emperor as Frederick III.
The first concern of the new king was with the papal schism. The council of Basel was still sitting, and had elected an anti-pope, Felix V., in opposition to Eugenius IV., while the electors, adhering to their neutral attitude, sought to bring Frederick into line with them on this question. Some years were occupied in negotiations, but the king soon showed himself anxious to come to terms with Eugenius, and about 1446 the electors ceased to act together. At length peace was made. The consent of several of the electors having been purchased by concessions, Frederick signed with Pope Nicholas V., the successor of Eugenius, in February 1448 the concordat of Vienna, an arrangement which bound the German Church afresh to Rome and perpetuated the very evils from which earnest churchmen had been seeking deliverance. Thus Germany lost the opportunity of reforming the Church from within, and the upheaval of the 16th century was rendered inevitable.
Frederick's reign is one of great importance in the history of Austria and of the house of Habsburg, but under him the fortunes of Germany sank to the lowest possible point. Without any interference from the central authority wars were waged in every part of the country, and disputes of every kind were referred to the decision of the sword. The old enmity between the cities and the princes blazed out afresh; grievances of every kind were brought forward and many struggles were the result. Perhaps the most famous of these was one between a confederation of Franconian and Swabian cities under the leadership of Nuremberg on the one side, and Albert Achilles, afterwards elector of Brandenburg, and a number of princes on the other. The war was carried on with great barbarity for about four years (1449-1453), and was in every respect a critical one. If the cities had gained the day they might still have aimed at balancing the power of the princes, but owing partly to their imperfect union, partly to the necessity of fighting with hired troops, they did not gain any serious advantage. On the whole, indeed, in spite of temporary successes, they decidedly lost ground, and on the conclusion of peace there was no doubt that the balance of power in the state inclined to the princes. Frederick meanwhile was involved in wars with the Swiss, with his brother Albert and his Austrian subjects, and later with the Hungarians. He had no influence in Italy; in Burgundy he could neither stop Duke Philip the Good from adding Luxemburg to his possessions, nor check the towering ambition of Charles the Bold; while after the death of Charles in 1477 he was equally unable to prevent the king of France from seizing a large part of his lands. Torn by dissensions the Teutonic Order was unsuccessful in checking the encroachments of the Poles, and in 1466 the land which it had won in the north-east of Germany passed under the suzerainty of Poland, care being taken to root out all traces of German influence therein. Another loss took place in 1460, when Schleswig and Holstein were united with Denmark. In Germany itself the king made scarcely any pretence of exercising the supreme authority; for nearly thirty years he never attended the imperial diet, and the suggestions which were made for his deposition failed only because the electors could not agree upon a successor. In his later years he became more of a recluse than ever, and even before February 1486, when his son Maximilian was chosen German king, he had practically ceased to take any part in the business of the Empire, although he survived until August 1493.