During the second phase of the Migration Period (500–700 CE), new groups shaped the future of Austria. Around 500 CE, the Lombards briefly appeared in northern and eastern regions but were pushed south into Italy by 567 when the Avars advanced into the region, bringing with them Slavic vassals. The Avars established dominance from the Baltic to the Balkans, but their defeat near Constantinople in 626 spurred Slavic revolts and the creation of independent Slavic territories.
One of the most significant Slavic groups was the Carantanians (Alpine Slavs), who migrated westward along the Drava River, mixing with the local Celto-Romanic population. They established Carantania, the first independent Slavic state in Europe, centered at Zollfeld (modern Carinthia). By the 7th century, the Carantanians had resisted Avar control and defended themselves from neighboring Frankish incursions. However, in 745 CE, under pressure from both Avars and Franks, Carantania became a vassal of Bavaria and was eventually absorbed into the Carolingian Empire.
Meanwhile, in the west, the Bavarii (Bavarians), a Germanic tribe and vassals of the Franks, began to consolidate power. By 550 CE, the Bavarians had formed a stem duchy under the Agilolfing dynasty with its center at Regensburg, expanding their territory into what is now western Austria and South Tyrol. They mixed with the Rhaeto-Romanic population, pushing them further into the mountains. Bavarian migration reached as far as the Puster Valley and later extended to the Enns River by 610 CE.
By 650 CE, the Slavs had advanced westward but halted further Bavarian expansion. A settlement boundary between the two groups emerged, stretching from Freistadt through Linz and Salzburg to East Tyrol. The Avars and Slavs occupied the eastern regions of Austria and parts of modern Bohemia. Over time, Bavarian settlers moved down the Danube and into Alpine valleys, laying the foundation for Austria’s future as a German-speaking region. However, in southern Carinthia, the Slavs maintained their language and identity until the early 20th century, when assimilation reduced them to a minority population.