The Nazi Gaue were formed in 1926 as Nazi party districts of the respective German states and Prussian provinces as shaped in the aftermath of World War I. Each Gau had an administrative leader, the Gauleiter (Gau leader). Though Länder and Prussian provinces continued to exist after the Enabling Act of 1933, their administration was reduced to a rudimentary body attached to the respective Nazi Gau administration in the Gleichschaltung process. In total, Germany consisted of 32 Gaue in 1934, and 42 Gaue at its collapse in 1945.
The regions occupied in 1938 (Austria, Sudetenland) and early 1939 (Memelland) as well as the areas conquered during the Second World War were either incorporated into existing Gaue or organised in Reichsgaue, similar to the Gaue in all but name. In the Reichsgaue, the Gauleiter also carried the position of Reichsstatthalter, thereby formally combining the spheres of both party and state offices. A special political award, known as the Gau Badge, was issued in most Nazi Gaue.
Eventually, in the aftermath of its defeat in the war, and the Yalta Conference, Germany would lose not only the newly annexed territories but some of the territories it held before the Nazi government assumed power; it would also spend most of the following second half of the 20th century divided into two separate states.
The Gaue existed parallel to the German states, the Länder, and Prussian provinces throughout the Nazi period. Pro forma, the Administrative divisions of Weimar Germany was left in place. The plan to abolish the Länder was ultimately given up because Hitler shrank away from structural reforms, a so-called Reichsreform, fearing it would upset local party leaders. For the same reason, the borders of the Gaue remained unchanged within Germany throughout this time. The Gaue were only enlarged through the adding of occupied territories after 1938. While the Länder continued to exist, the real power on local level did lie with the Gauleiters, not the Minister Presidents of the German states. The Gauleiters were directly appointed by Hitler and only answerable to him. In practice, interference from above was rare and their power almost absolute.
New Reichsgaue were established after the Anschluss of Austria and the incorporation of Sudetenland following the Munich Agreement. Southern parts of Czechoslovakia also gained by the Munich Agreement were not made part of Reichsgau Sudetenland, but incorporated into the northern Reichsgaue of former Austria.