Prior to 1803 Salzburg encompassed a territory of 14,000sq km, almost twice as much as today, and had around 150,000 inhabitants. Since the earliest times, Salzburg has been divided into two regions on the sides of the Tauern Mountains, which now include the districts Lungau, Pongau, Pinzgau, Tennengau and Flachgau. The Pinzgau and Pongau districts date back to the AD 700s. The south-easternmost corner of the Salzburg valley, the Lungau, was first mentioned in a document in the first half of the 10th Century. Tennengau dates from the 19th Century and Flachgau from the 20th Century. 

Salzburg was incorporated into Austrian territory under the 1805 Treaty of Pressburg, becoming a province of a vast empire. Austria declared war on France in 1809, which it lost. As a result, Salzburg passed under French rule for one and a half years. From 1810 to 1816, the area as far as Kitzbuhel went to Bavaria under the name Salzach, when the regional assembly was dissolved and the university closed. A Salzburg parliament was elected again in 1816, and has gathered regularly ever since, except during the Second World War.

The last Austrian emperor abdicated in the early 20th Century. In 1918, the German Austrian Republic was proclaimed. The federal constitution was adopted in 1921, and Austria has been governed according to republican and federalist principals ever since. In the referendum of 1921, the citizens of Salzburg refused to be annexed by Germany.

In 1933, the unemployment rate in Salzburg was at 32 percent, but construction of the Grossglockner High alpine Road, a major tourist attraction today, commenced in 1935 and created many jobs. The first performance of the mystery play Everyman took place in 1920, marking the beginning of the Salzburg Festival, which today ensures a buoyant economy for the city.