Political unity of the German-speaking lands had been talked about for decades inside the loose 39-state confederation left by the 1815 Congress of Vienna, but had never been brought about. Who would build the 'Little Germany' (Kleindeutsch) solution that left Austria out, and how? When Otto von Bismarck, appointed Prussian minister-president in 1862, declared that the question would be settled 'not by speeches and majority decisions but by iron and blood', he was announcing a programme.

Bismarck carried it out in three wars. In 1864 alongside Austria against Denmark (the Schleswig-Holstein affair); in 1866 against Austria itself (the battle of Königgrätz / Sadowa, which expelled Austria from the German world and produced the North German Confederation); and in 1870–71 against France. The French war was militarily decided already in September 1870 at Sedan, where Emperor Napoleon III himself was captured; but the siege of Paris ran through the winter. In the warmth of this common war, the South German states (Bavaria, Baden, Württemberg, Hesse) joined the confederation.

On 18 January 1871 — the 170th anniversary of the Prussian royal title — Wilhelm was proclaimed German Emperor in the Hall of Mirrors of the occupied Palace of Versailles. The choice of place was political: at the symbolic royal heart of France, on French soil. Bismarck became Imperial Chancellor; the constitution was federal but preserved the decisive weight of Prussia (the Reichstag was elected by universal male suffrage, but executive power lay with emperor and chancellor). The Treaty of Frankfurt in May 1871 transferred most of Alsace and Lorraine from France to Germany — planting an expectation of revenge that would carry through to 1914.

German unification redrew the political geography of Europe. At the centre of the continent stood a new great power — first in population, in industry, in military weight. The balance maintained since 1815 was broken. Between 1871 and 1890 Bismarck tried to manage the new equilibrium with intricate alliances; once he was dismissed in 1890, an unrestrained Germany entered a cycle of friction with the powers around it (France, Russia, eventually Britain). Germany's late arrival to the colonial scramble, pursued with the claim of a 'belated empire' to overseas share, is read as one of the conditions that prepared the First World War. Domestically the empire produced, through rapid industrialisation, modern science and university reform, one of the most dynamic societies of late-19th-century Europe.