Joseph II (1780-90), a dynamic leader strongly influenced by the Enlightenment, shook Hungary from its malaise when he inherited the throne from his mother, Maria Theresa. Joseph sought to centralize control of the empire and to rule it by decree as an enlightened despot. He refused to take the Hungarian coronation oath to avoid being constrained by Hungary's constitution. In 1781 Joseph issued the Patent of Toleration, which granted Protestants and Orthodox Christians full civil rights and Jews freedom of worship. He decreed that German replace Latin as the empire's official language and granted the peasants the freedom to leave their holdings, to marry, and to place their children in trades. Hungary, Croatia, and Transylvania became a single imperial territory under one administration. When the Hungarian nobles again refused to waive their exemption from taxation, Joseph banned imports of Hungarian manufactured goods into Austria and began a survey to prepare for imposition of a general land tax.

Joseph's reforms outraged Hungary's nobles and clergy, and the country's peasants grew dissatisfied with taxes, conscription, and requisitions of supplies. Hungarians perceived Joseph's language reform as German cultural hegemony, and they reacted by insisting on the right to use their own tongue. As a result, Hungarian lesser nobles sparked a renaissance of the Magyar language and culture, and a cult of national dance and costume flourished. The lesser nobles questioned the loyalty of the magnates, of whom less than half were ethnic Magyars, and even those had become French- and German-speaking courtiers. The Magyar national reawakening subsequently triggered national revivals among the Slovak, Romanian, Serbian, and Croatian minorities within Hungary and Transylvania, who felt threatened by both German and Magyar cultural hegemony. These national revivals later blossomed into the nationalist movements of the nineteenth and twentieth centuries that contributed to the empire's ultimate collapse.

Late in his reign, Joseph led a costly, ill-fated campaign against the Turks that weakened his empire. On January 28, 1790, three weeks before his death, the emperor issued a decree canceling all of his reforms except the Patent of Toleration, peasant reforms, and abolition of the religious orders.

Joseph's successor, Leopold II (1790-92), recognized Hungary again as a separate country under a Habsburg king and reestablished Croatia and Transylvania as separate territorial entities. In 1791 the Diet passed Law X, which stressed Hungary's status as an independent kingdom ruled only by a king legally crowned according to Hungarian laws. Law X later became the basis for demands by Hungarian reformers for statehood in the period from 1825 to 1849. New laws again required approval of both the Habsburg king and the Diet, and Latin was restored as the official language. The peasant reforms remained in effect, however, and Protestants remained equal before the law. Leopold died in March 1792 just as the French Revolution was about to degenerate into the Reign of Terror and send shock waves throu6fa ough the royal houses of Europe.

Enlightened absolutism ended in Hungary under Leopold's successor, Francis I (1792-1835), who developed an almost abnormal aversion to change, bringing Hungary decades of political stagnation. In 1795 the Hungarian police arrested an abbot and several of the country's leading thinkers for plotting a Jacobin kind of revolution to install a radical democratic, egalitarian political system in Hungary. Thereafter, Francis resolved to extinguish any spark of reform that might ignite revolution. The execution of the alleged plotters silenced any reform advocates among the nobles, and for about three decades reform ideas remained confined to poetry and philosophy. The magnates, who also feared that the influx of revolutionary ideas might precipitate a popular uprising, became a tool of the crown and seized the chance to further burden the peasants.

Data as of September 1989