Despite a worldwide economic crisis and mass unemployment, Ufa was thoroughly successful in the early 1930s. Talkie operettas like DIE DREI VON DER TANKSTELLE (1930, directed by Wilhelm Thiele) gave audiences a temporary escape from everyday life, and conservative pro-Prussia and other patriotic films were produced – entirely along Alfred Hugenberg’s lines.
The company conformed quickly with the National Socialist dictatorship, firing Jewish colleagues and premiering HITLERJUNGE QUEX (1933, directed by Hans Steinhoff) in Adolf Hitler’s presence. Ufa continued to produce and distribute entertainment and propaganda vehicles, and the company was nationalized in 1937. During the Second World War, its empire stretched over the territories under German occupation. Minister of Propaganda Joseph Goebbels consolidated the entire German film industry under the name Ufa Film GmbH (Ufi) in 1942. Ufa’s last big production was Veit Harlan’s 1944 morale-booster KOLBERG.
One year after the war’s end, Deutsche Film AG (DEFA) was founded in the Soviet Zone; DEFA would operate the Babelsberg Studios from that point on. The Western Allies attempted to prevent a resurrection of Ufa through legislation.