Early political career In the year of his marriage, Bismarck was chosen as a representative to the newly created Prussian legislature, the Vereinigter Landtag. There, he gained a reputation as a royalist and reactionary politician; he openly advocated the idea that the monarch had a divine right to rule.

In March of the next year, Prussia faced a revolution (one of the Revolutions of 1848 which shook many European nations), which completely overwhelmed King Friedrich Wilhelm IV. The monarch, though initially inclined to use armed forces to suppress the rebellion, ultimately succumbed to the revolutionary movement. He offered numerous concessions to the liberals: he promised to promulgate a constitution, agreed that Prussia and other German states should merge into a single nation, and appointed a liberal, Ludolf Camphausen, as Minister-President. The liberal victory, however, was short-lived; it perished by the end of the year 1848. The movement became weak due to fighting between internal factions, whilst the conservatives regrouped, gained the support of the King, and retook control of Berlin. Although a constitution was still granted, its provisions fell far short of the demands of the revolutionaries.

In 1849, he was elected to the Landtag, the lower house of the new Prussian legislature. At this stage in his career, he opposed the unification of Germany, arguing that Prussia would lose its independence in the process. He accepted his appointment as one of Prussia's representatives at the Erfurt Parliament, an assembly of German states that met to discuss plans for union, but only in order to oppose that body's proposals more effectively. The Parliament, in any event, failed to bring about unification, for it lacked the support of the two most important German states, Prussia and Austria.

In 1852, Friedrich Wilhelm appointed Bismarck as Prussia's envoy to the diet of the German Confederation in Frankfurt. His eight years in Frankfurt were marked by changes in his political opinions. No longer under the influence of his ultraconservative Prussian friends, Bismarck became less reactionary and more moderate. He became convinced that Prussia would have to ally itself with other German states in order to countervail Austria's growing influence. Thus, he grew more accepting of the notion of a united German nation.

In 1858, Friedrich Wilhelm IV suffered a stroke that left him paralysed and mentally disabled. His brother, Wilhelm, took over the government of the realm as Regent. Shortly thereafter, Bismarck was replaced as the Prussian envoy in Frankfurt; he was instead made Prussia's ambassador to Russia. He stayed in St. Petersburg for four years, during which time he befriended his future adversary, the Russian Prince Gorchakov. In June 1862, he was sent to Paris, so that he could serve as the Prussian ambassador to France. Despite his lengthy stay abroad, Bismarck was not entirely detached from German domestic affairs; he remained well-informed due to his friendship with Albrecht von Roon, the Minister of War.

Ministerpräsident (Prime Minister) of Prussia The Regent became King Wilhelm I upon his brother's death in 1861. The new monarch was often in conflict with the increasingly liberal Prussian Diet. A crisis arose in 1862, when the Diet refused to authorise funding for a proposed re-organisation of the army. The King's ministers were unable to convince legislators to pass the budget, and the King was unwilling to make concessions, so the deadlock continued. Wilhelm believed that Bismarck was the only politician capable of handling the crisis, but was ambivalent about appointing a man who demanded unfettered control over foreign affairs. When, in September 1862, the Abgeordnetenhaus (House of Deputies) overwhelmingly rejected the proposed budget, Wilhelm was forced to recall Bismarck to Prussia. On 23 September 1862, Wilhelm appointed Bismarck Minister-President and Foreign Minister.

He was intent on maintaining royal supremacy by ending the budget deadlock in the King's favour, even if he had to use extralegal means to do so. He contended that, since the Constitution did not provide for cases in which legislators failed to approve a budget, he could merely apply the previous year's budget. Thus, on the basis of the budget of 1861, tax collection continued for four years.

Bismarck's conflict with the legislators grew more heated during the following years. In 1863, the House of Deputies passed a resolution declaring that it could no longer come to terms with Bismarck; in response, the King dissolved the Diet, accusing it of trying to obtain unconstitutional control over the ministry. Bismarck then issued an edict restricting the freedom of the press; this policy even gained the public opposition of the Crown Prince, Friedrich Wilhelm (the future King Friedrich III). Despite attempts to silence critics, Bismarck remained a largely unpopular politician. His supporters fared poorly in the elections of October 1863, in which a liberal coalition (whose primary member was the Progressive Party, or Fortschrittspartei) won over two-thirds of the seats in the House of Deputies.

Notwithstanding unpopularity and numerous conflicts with the Diet, Bismarck retained power because he had the support of the King. Wilhelm I feared that if he dismissed Bismarck, a liberal ministry would follow; thus, he did not dismiss the Minister-President, despite the repeated calls of the House of Deputies.

The Defeat of Denmark and Austria Before unification, Germany consisted of a multitude of principalities loosely bound together as members of the German Confederation. Bismarck played a crucial role in uniting most of the Confederation's members into a single country. In his first speech as Minister-President, he had referred to the issue of German unification in a now famous remark: "the great questions of the day will not be decided by speeches and the resolutions of majorities — that was the great mistake from 1848 to 1849 — but by iron and blood." Bismarck used both diplomacy and the Prussian military in order to achieve the objective of German unification. He excluded Austria from unified Germany, for he sought to make Prussia the most powerful and dominant component of the nation.

Bismarck faced a diplomatic crisis when King Frederick VII of Denmark died in November 1863. Succession to the duchies of Schleswig and Holstein was disputed; they were claimed by Christian IX (Frederick VII's heir as King) and by Frederick von Augustenburg (a German duke). Prussian public opinion strongly favoured Augustenburg's claim; however, Bismarck took an unpopular step by insisting that the territories legally belonged to the Danish monarch under the London Protocols signed a decade earlier. Nonetheless, Bismarck did denounce Christian's decision to annex the duchy of Schleswig to the Denmark proper. With support from Austria, he issued an ultimatum for Christian IX to return Schleswig to its former status; when the Danes refused, Austria and Prussia invaded, commencing the Second War of Schleswig. As a result of the German victory, Denmark was forced to cede both duchies. Originally, it was proposed that the Diet of the German Confederation (in which all the states of Germany were represented) determine the fate of the duchies; however, before this scheme could be effected, Bismarck induced Austria to agree to the Gastein Convention. Under this agreement, Prussia received Schleswig, while Holstein went to the Austrians.

In 1866, Austria reneged on its prior agreement with Prussia by demanding that the Diet of the German Confederation determine the Schleswig-Holstein issue. Bismarck used Austria's demand as an excuse; charging that the Austrians had violated the Convention of Gastein, he sent Prussian troops to occupy Holstein. Provoked, Austria called for the aid of other German states, who quickly became involved in the Austro-Prussian War. Prussia quickly defeated Austria and its allies, deciding the conflict with a crushing victory at the Battle of Königgrätz (aka "Battle of Sadowa"). As a result of the Treaty of Prague, the German Confederation was dissolved; Prussia annexed Schleswig, Holstein, Frankfurt, Hanover, Hesse-Kassel, and Nassau; and Austria promised not to intervene in German affairs. To solidify Prussian hegemony, Prussia and several other North German states joined the North German Confederation in 1867; King Wilhelm I served as its President, and Bismarck as its Chancellor.

Military success brought Bismarck tremendous political support in Prussia. In the elections to the House of Deputies held in 1866, the liberals suffered a major defeat, losing their large majority. The new, largely conservative House was on much better terms with Bismarck than previous bodies; at the Minister-President's request, it retroactively approved the budgets of the past four years, which had been implemented without parliamentary consent. Hence, Bismarck is considered one of the most talented statesmen in history.

The Establishment of the German Empire Prussia's victory over Austria increased tensions with France. The French Emperor, Napoleon III, feared that a powerful Prussia would upset the balance of power in Europe. Bismarck, at the same time, sought war with France; he believed that if the German states perceived France as the aggressor, they would unite behind the King of Prussia. A suitable premise for war arose in 1870, when the German Prince Leopold of Hohenzollern-Sigmaringen was offered the Spanish throne, which had been vacant since a revolution in 1868. The French not only blocked the candidacy, but also demanded assurances that no member of the House of Hohenzollern become King of Spain. Bismarck then published the Ems Dispatch, a tactically shortened, thereby more cutting, version of a conversation between King Wilhelm and the French ambassador. The publication was intended to provoke France into declaring war on Prussia.

The Ems Dispatch had the desired effect. France mobilized and declared war, but was seen as the aggressor; as a result, German states, swept up by nationalism and patriotic zeal, rallied to Prussia's side and provided troops (the Bismarck family contributed its two sons to the Prussian cavalry). The Franco-Prussian War (1870) was a great success for Prussia; the enemy was utterly crushed. France was forced to pay a large indemnity; moreover, it surrendered the territory of Alsace-Lorraine.

Bismarck decided to act immediately to secure the unification of Germany. He opened negotiations with representatives of southern German states, offering special concessions if they were to acquiesce to unification. The negotiations were successful; King Wilhelm was crowned "German Emperor" on 18 January 1871 in the Hall of Mirrors in the Château de Versailles (thereby further humiliating France). The new German Empire was a federal one: each of its twenty-five constituent states (kingdoms, grand duchies, duchies, principalities, and free cities) retained its autonomy. The King of Prussia, as German Emperor, was not sovereign over the entirety of Germany; he was only primus inter pares, or first amongst equals.

Chancellor of the German Empire Otto von Bismarck, until 1871 a Graf (Count), was raised to the rank of Fürst (Prince). He was also appointed Imperial Chancellor of the German Empire, but retained his Prussian offices (including those of Minister-President and Foreign Minister); thus, he held almost complete control of both domestic and foreign policy. The office of Minister-President of Prussia was temporarily separated from that of Chancellor in 1873, when Albrecht von Roon was appointed to the former office. By the end of the year, however, Roon resigned due to ill health, and Bismarck once again became Minister-President.

In the following years, one of Bismarck's primary political objectives was the reduction of the influence of Roman Catholics in Germany. Prussia (with the exception of the Rhineland) and most other northern German states were predominantly Protestant; however, many Catholics lived in the southern German states (especially Bavaria). Bismarck believed that the Roman Catholic Church held too much political power; moreover, he was concerned about the emergence of the Catholic Centre Party (organised in 1870). Accordingly, he began an anti-Catholic campaign known as the Kulturkampf. In 1871, the Catholic Department of the Prussian Ministry of Culture was abolished, and in 1872, the Jesuits were expelled from Germany. More severe laws passed in 1873 allowed the government to supervise the education of the clergy, and curtailed the disciplinary powers of the Church. In 1875, civil ceremonies were required for weddings, which could hitherto be performed in churches. These efforts, however, only strengthened the Catholic Centre Party. Largely unsuccessful, Bismarck abandoned the Kulturkampf in 1878.