By the beginning of the 18th century the major powers of Europe--primarily Spain, France, Habsburg Austria [the Holy Roman Empire], and England--had established a delicate balance of power. No one nation possessed sufficient strength to overwhelm an alliance of the others. Suddenly in 1700 that balance was upset by the ambition of King Louis XIV of France. Encouraged by Louis XIV, King Charles II of Spain, as he was dying without children, designated Louis' grandson Duke Philip of Anjou as his heir and successor to the throne of Spain. Louis XIV's vision was to bring about a union of France and Spain.

The prospect of a unification of the might of France and Spain was unacceptable to the other major powers of Europe, and to most of the smaller powers as well. They determined that, in the interest of European stability, the Spanish throne should go to a different claimant: Archduke Charles of Austria. Archduke Charles was a cousin of the deceased King Charles II and a brother of the powerful Emperor of the Holy Roman Empire, King Joseph I of Austria.

The parties failed to resolve the dispute amicably, and a long general war erupted across Europe in 1701. The conflict is known in history as the War of Spanish Succession, or sometimes as Queen Anne's War. Battles raged across Italy, the Low Countries, the German States, France and Spain for eleven years. The tide of war was moving inexorably against the French and their allies when a sudden expected event caused a suspension of hostilities: Emperor Joseph I died and Archduke Charles of Austria succeeded to his throne. The powers allied against France quickly realized that the goal they had been fighting, namely, to place Archduke Charles on the throne of Spain, was no longer acceptable; a unification of Austria and Spain was every bit as dangerous as a unification of France and Spain.

A peace conference was assembled the following year at Utrecht, and a complex resolution of the dispute was hammered out. A key element of treaty that emerged was an agreement that Duke Philip of Anjou would retain the Spanish crown that he held as King Philip V, but subject to the condition that Spain and France would never be united. The treaty also included a variety of other territorial realignments among the European states, including a transfer of Sicilian sovereignty.

Austria did not immediately join into the peace agreement, but signed a substantially similar one the following year at Rastatt.