The acceptance of the Spanish crown by Philip V in the face of counterclaims by Archduke Charles of Austria, who was supported by England and the Netherlands, was the proximate cause of the War of the Spanish Succession (1702-14), the first "world war" fought by European powers. In 1705 an Anglo-Austrian force landed in Spain. A Franco-Castilian army halted its advance on Madrid, but the invaders occupied Catalonia. Castile enthusiastically received the Bourbon dynasty, but the Catalans opposed it, not so much out of loyalty to the Habsburgs as in defense of their fueros against the feared imposition of French-style centralization by a Castilian regime.

The War of the Spanish Succession was also a Spanish civil war. Britain agreed to a separate peace with France, and the allies withdrew from Catalonia, but the Catalans continued their resistance under the banner "Privilegis o Mort" (Liberty or Death). Catalonia was devastated, and Barcelona fell to Philip V after a prolonged siege (1713-14).

The Treaty of Utrecht (1713) brought the war to a close and recognized the Bourbon succession in Spain on the condition that Spain and France would never be united under the same crown. The Spanish Netherlands (which become known as the Austrian Netherlands and later as Belgium) and Spain's Italian possessions, however, reverted to the Austrian Habsburgs. Britain retained Gibraltar and Minorca, seized during the war, and received trade concessions in Spanish America. Spain emerged from the war with its internal unity and colonial empire intact, but with its political position in Europe weakened.

Philip V undertook to modernize Spanish government through his French and Italian advisers. Centralized government was institutionalized, local fueros were abrogated, regional parliaments were abolished, and the aristocracy's independent influence on the councils of state was destroyed.

Data as of December 1988