One of the most famous and, for Innsbruck, most important princely couples ruled Tyrol at the very time when the Thirty Years' War was devastating Europe. When Maximilian III of Austria died childless, a replacement was needed as governor of Tyrol. The Habsburg Leopold (1586 - 1632), who was still Bishop of Passau in 1618, was chosen to take over the affairs of state. In 1625, Leopold, who had meanwhile been elevated to Duke, renounced his ecclesiastical dignities in order to marry and found a new Tyrolean line of the House of Habsburg. Claudia de Medici (1604 - 1648) from the powerful and rich princely family from Tuscany was chosen as his bride. The Medici had made a fortune in the cotton and textile trade, but above all in financial transactions, and had risen to political power. The wedding celebrations of the Habsburgs and Medici were one of the most magnificent festivities in the city's history and kept the city in suspense for a fortnight. The bridal couple entered the city in a long procession through two specially erected gates. A wide-ranging entertainment programme, including "Bears, Turks and Moors" sent Innsbruck into raptures and amazement.

Under the Medici, Florence had become the cultural and financial centre of Europe, comparable to New York in the 20th century. Despite its status as a royal seat, Innsbruck could not compete with this, even though Leopold did everything in his power to change this. Swearing, shouting and the use of firearms in the streets were banned, as was the free roaming of farm animals within the city limits. Litter, which was a particular problem when there was no rain and no water flowing through the sewer system, was regularly cleaned up by princely decree.

The couple's reign, which was characterised by the turmoil of the Thirty Years' War, was less splendid than their idea of a royal seat. Although Innsbruck was spared direct acts of war, the supply situation was nevertheless precarious. Leopold and Claudia only allowed their glamourous court life to be limited by this.

After Leopold's early death, Claudia ruled the country with the help of her court chancellor Wilhelm Biener (1590 - 1651) with modern, early absolutist policies and a strict hand. Biener centralised parts of the administration and disempowered the often corrupt and arbitrary local petty nobility in favour of the prince in order to finance the expansion of the Tyrolean defence system. The Swedes, who were notorious for their brutality, threatened the Tyrolean borders, but could thus be repelled. Defence fortifications were built near Scharnitz on today's German border and named after the sovereign princess Porta Claudia called. Remains of it can still be seen today. The uncomfortable Biener was recognised by Claudia's successor, Archduke Ferdinand Karl, and the provincial estates as a Persona non grata imprisoned and beheaded in 1651 after a show trial.

A touch of Florence and Medici still characterises Innsbruck today: both the Jesuit church, where Claudia and Leopold found their final resting place, and the Mariahilf parish church still bear the coat of arms of their family with the red balls and lilies. The Old Town Hall in the old town centre is also known as Claudiana known. The theatre in Innsbruck is particularly associated with Leopold's name to this day, and a fountain on the forecourt commemorates him. A street name in Saggen was dedicated to Chancellor Wilhelm Biener.