Following Sebastian's demise at the Battle of Alcácer Quibir in 1578, the elderly Cardinal Henry assumed the role of king. However, due to his holy orders, he had no descendants to succeed him. When Henry passed away, three grandchildren of Manuel I emerged as claimants to the throne: Infanta Catarina, Duchess of Braganza; António, Prior of Crato; and Philip II of Spain.

Amidst competing claims, António was acclaimed as King of Portugal in various cities, while members of the Council of Governors who favored Philip fled to Spain and declared him the legitimate successor. Philip II swiftly marched into Portugal and decisively defeated António's troops in the Battle of Alcântara, solidifying his control over the region. Recommends

With the Portuguese people enduring significant losses, Philip ascended the Portuguese throne in September 1580 and assumed the title of Philip I of Portugal. This marked the beginning of a nearly sixty-year personal union under the Philippine Dynasty. The consolidation of power granted Philip authority over the vast Portuguese empire.

Although Philip relocated to Madrid in 1583, he appointed his nephew, Albert of Austria, as viceroy in Lisbon. To ensure effective governance, he established the Council of Portugal in Madrid, composed of Portuguese nobles who held prominent positions in the Spanish courts. Furthermore, he allowed Portugal to maintain autonomy in matters of law, currency, and government, following the established pattern of rule by councils.

The Philippine Dynasty's rule over Portugal had far-reaching implications for the nation's history and its relationship with Spain. The empire underwent a transformation under Spanish influence, while Portuguese interests and governance retained a degree of independence. The intricacies of this union and its impact on both countries continue to be subjects of study and debate among historians.

As King Philip II of Spain and Portugal left an indelible mark on the Iberian Peninsula, his reign shaped the destiny of these interconnected nations for decades to come.