Under the Versailles Treaty, most Ukrainian territory was divided between three powers – the USSR, Poland, and Czechoslovakia. Czechoslovakia occupied the region known as Pidkarpattya – Subcarpathia. Compared to both the Polish and Soviet occupations of Ukrainian territory, Czechoslovak rule in Subcarpathia was relatively benign, and the region soon became a focus for the activity of the Ukrainian struggle for independence, and a nationally conscious Ukrainian literary community.

On 11 October 1938 the Czechoslovakian government, as it was required to do by the Treaty of Versailles, granted autonomy to Subcarpathia, establishing Carpatho Ukraine. On 26 October Monsignor Augustyn Voloshyn was appointed premier of Carpatho Ukraine. An elected legislature, the Carpatho Ukrainian Diet, was created, with its seat in Khust. Elections to the Diet took place on 12 February 1939. The Carpatho Ukrainian government established a military force, the Carpathian Sich.

On 15 March 1939, as the German army was marching into Prague, Carpatho Ukraine declared independence, and Voloshyn was appointed president of the new republic. Hitler authorized the Hungarian occupation of Carpatho Ukraine, in part in order to reassure Stalin that Hitler would not support any independent Ukrainian state.

The under-equipped Carpathian Sich resisted the Hungarian invasion, but was soon decimated by the Hungarian army, and Carpatho Ukraine was incorporated into Hungary. Some 5000 Carpatho Ukrainians, and several hundred Galician Ukrainians who had come to assist the new Ukrainian state, died in the fighting. Carpatho Ukraine thus became the first state to resist Hitler and his allies with arms.