The dilemma of conflicting nationalisms in Ireland helps one appreciate how desperate the situation in the Austro-Hungarian Empire had become by the early twentieth century as well. In 1848, Magyar nationalism had driven Hungarian patriots to declare an independent Hungarian republic, which Russian and Austrian armies savagely crushed in the summer of 1849. Throughout the 1850s, Hungary was ruled as a conquered territory.

Then, in the wake of its defeat by Prussia in 1866 and loss of northern Italy, a weakened Austria agreed to a compromise and in 1867 established the so-called dual monarchy. The Austrian Empire was divided in two, and the Magyars gained virtual independence for Hungary. Henceforth each half of the empire dealt with its own ethnic minorities. The two states still shared the same monarch and common ministries for finance, defense, and foreign affairs.

In Austria, ethnic Germans were only one-third of the population, and many Germans saw their traditional dominance threatened by Czechs, Poles, and other Slavs. From 1900 to 1914, the legislature was so divided that ministries generally could not obtain a majority and ruled instead by decree. Efforts by both conservatives and socialists to defuse national antagonisms by stressing economic issues that cut across ethnic lines were largely unsuccessful.

In Hungary, the Magyar nobility in 1867 restored the constitution of 1848 and used it to dominate both the Magyar peasantry and the minority populations until 1914. While Magyar extremists campaigned loudly for total separation from Austria, the radical leaders of their subject nationalities dreamed of independence from Hungary. Unlike most major countries, which harnessed nationalism to strengthen the state after 1871, the Austro-Hungarian Empire was progressively weakened by it.