French efforts at monarchy in North America were not so successful. In 1862, Napoleon III sent 40,000 soldiers to Mexico to support the establishment of the Second Mexican Empire, under Emperor Maximilian I. The empire lasted four years. After incurring supreme opposition from the United States and seeing that the troops in Mexico could be needed to defend France itself given Prussia's lightning-quick victory over Austria in the Austro-Prussian War of 1866, Napoleon III abandoned the Mexican empire and called his troops home.

In that war, Prussia made quick work of Austria, not least because France had agreed to sit on the sidelines. At the same time, the emperor's health turned for the worse. His time in prison had weakened his constitution, and he was a heavy smoker. He took opium as a treatment for various internal ailments and was often lethargic afterward.

Napoleon III was not blind to the military prowess of neighboring Prussia, which had also availed itself of the opportunity to defeat Denmark in a war just before routing Austria. In 1867, the emperor proposed a method to increase the size of the French Army by requiring universal military service, which Prussia had already done. Opposition to this proposal was so fierce from all quarters, including the French military, that the emperor pursued it no further. Napoleon III sought alliances with both Austria and Italy, ostensibly to fight against Prussia, should war with that country occur. No alliance was forthcoming, not even from the emperor's strong ally the U.K. When the Franco-Prussian War began, this lack of allies proved extremely problematic for France.

Elections in 1869 had resulted in a victory for the government but a much narrow victory than before. Napoleon III appointed as his prime minister Olivier-Émile Ollivier, known to be in favor with the more liberal part of the population. It was the capstone of a period of concessions by the emperor–including the granting of freedom of assembly and freedom of the press–that resulted from extreme unrest in the wake of a serious downturn in the economy.

Also in 1869, the throne of Spain was vacant and the man named to be the new king was Leopold of Hohenzollern-Sigmaringen, a Prussian prince. (The Spanish throne had been empty since a revolution in 1868 had end the long reign of the Bourbons.) Napoleon III loudly declared his opposition to having Prussian rulers on France's western and eastern borders, and Spain agreed to find another king. The French ruler insisted that his Prussian counterpart, Wilhelm I, apologize via a state telegram. Wilhelm I agreed to do this, but German Chancellor Otto von Bismarck edited the telegraph to read as if it were extremely insulting to France and sent it on, hoping to use it as a pretext for war between France and Prussia.

Napoleon III, wary of the expansionary interests of Bismarck and Prussia while also wanting to reclaim some of the glory of his namesake, was also looking for a pretext for war with Prussia; and after consulting with his generals (who assured him of a French victory on the battlefield, should it come to that), took the opportunity to be extremely insulted by the telegram (known as the Ems Dispatch) and urged the French parliament to declare war on Prussia. Parliament agreed, on July 16, 1870, and war began three days later.

The French military was confident that aid would come from not only Austria, which had only just fought a war with Prussia, but also a few of the southern German kingdoms wary of Prussian influence. But Austria chose to stay out of the war and the southern German kingdoms sided with Prussia.

In a precursor to the entire shape of the war, Prussia proved much more adept at mobilizing its troops and had sent more than 450,000 men on an invasion force that got itself into northeastern France before Napoleon III's government could mobilize its force, which consisted of just more than 270,000. The southern German kingdoms had sided with Prussia, giving Bismarck and Wilhelm and company much-needed support in manpower, money, weapons, and railroads. The latter proved especially important in Prussia's ability to move men and supplies rapidly from one place to place, seemingly at a moment's notice.

Despite deploying two technological advances in weaponry, the Chassepot rifle and the mitrailleuse (an early version of a machine gun), the French were outnumbered, outgunned, and out-mobilized. In addition, the Prussian practices of universal conscription (draft) and a full-time central military command proved decisive in many of the swift Prussian victories (Spicheren, Worth, Gravelotte, Mars-La-Tour, and Metz) that made up the war. Napoleon III himself was captured, at the Battle of Sedan, on September 2. Although the war continued, the empire did not, as revolutionary elements in Paris declared the Third Republic. German troops advanced all the way to Paris and lay siege to the city. On January 28, 1871, German troops seized control of France. Not long after, the German states declared themselves united, with Wilhelm I as their Kaiser. France, meanwhile, overthrew the revolutionary government (known as the Paris Commune).

Peace negotiations dragged on, and the Treaty of Frankfurt was signed on May 10, 1871. As a result, France had to pay a huge sum of money and give up some prime territory, including the oft-fought-over areas of Alsace and (most of) Lorraine. German troops also remained in France in significant numbers until the reparations had been delivered in full, two years later.

Napoleon III was a prisoner until March 19, 1871. Prussian forces kept him at a castle near Kassel. The National Assembly in 1871 declared him void of all governmental power and blamed him for the defeat in the war with Prussia. Out of options, he went back to the U.K. He lived in a large house in Chislehurst, in Kent, and spent his last years writing. His health deteriorated steadily, and he died on Jan. 9, 1873.

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