Maximilian III (1558 - 1618) was not only Governor of Tyrol and Vorderösterreich, but also Archduke of Austria, Administrator of Prussia and Grand Master of the Teutonic Order. The pious and moralising Habsburg occupies the ungrateful middle seat between the eccentrics Ferdinand II and Leopold V, which is why he is not firmly anchored in the memories of many Tyroleans. Maximilian the German master officially took up his post as Governor of Tyrol and Vorderösterreich in 1602. He was a pious and deeply religious man. Like many Habsburgs, he had to reconcile Christian charity with the office of sovereign in a peculiar way. He regularly withdrew for long periods into the seclusion of his study in the Capuchin monastery, founded in 1594, in order to live there in the most modest conditions and in abstinence. Under him, strict customs were introduced in Innsbruck. According to legend, children were forbidden to play in the streets. As a fervent representative of the Counter-Reformation, the manifestation of the Catholic faith was of particular concern to him. Unlike his predecessors, he wanted to achieve this through moral rigour rather than ostentatious building projects. He limited himself to completing churches that had already been started, such as the Servite Church or the Jesuit Church. Under his regency, the Jesuits expanded their educational mission by studying theology and dialectics. The deanery of Innsbruck was established. St Nicholas was given his own priest.

However, his piety did not exclude scientific interest and the practical measures derived from it for the good of the city. The 17th century was a time when open-minded aristocrats turned to alchemists to replenish the state coffers and had horoscopes cast by scientists such as Johannes Keppler, while they violently campaigned against the "heresy" of the Protestants. The Jesuit, physicist and astronomer Christoph Scheiner, one of the discoverers of sunspots alongside Galileo Galilei, spent three years at Maximilian's court in Innsbruck researching the human eye. Maximilian had him set up a telescope and carried out astronomical research together with Scheiner. The city's fire-fighting system and the hygiene of the Ritschenwhich served as a sewerage system and water source, were improved under him according to the latest knowledge of the time.

This was intended to protect the city from a repeat of the great catastrophe under Maximilian's aegis. During his reign, he had to contend with the outbreak of a plague epidemic. The Dreiheiligenkirche church in Kohlstatt, the working-class neighbourhood of the early modern period near the armoury, was built under his patronage to mark the occasion. The Thirty Years' War broke out in 1618 during his reign, but spared Innsbruck for the most part.

Maximilian died in the same year. His tomb in Innsbruck Cathedral is one of the most impressive tombs of the Baroque period.

Another Grand Master of the Teutonic Order from the House of Habsburg with a connection to Innsbruck is also buried next to him. Archduke Eugene was the supreme commander of the Austro-Hungarian army on the Italian front during the First World War. The Teutonic Order vividly illustrates the theological way of thinking and the connection between pious faith and secular power in the early modern period. In the period up to 1500, devout piety and the fear of God were often combined with the exercise of secular power. The order was founded as an order of knights around 1120 as part of the Crusades in Jerusalem. Church and chivalry united to enable pilgrims to visit the holy cities, especially the Church of the Holy Sepulchre, without danger. After the expulsion from Palestine, the knights of the Teutonic Order became involved on the side of Christian Magyars in Transylvania in present-day Romania against pagan tribes.

In the 13th century, the Order under Hermann von Salza was able to gain a great deal of land in the Baltic region in the fight against the pagan Prussians and to establish the Teutonic Order state establish. The Christian Order acted as a kind of state that, like religious fundamentalists today, invoked God and wanted to establish his order on earth. It was ideals such as Christian charity and the protection of the poor and helpless that also drove the Teutonic Order at its core. This made it an ideal fit for the Habsburg dynasty.

After the decline of the Order in north-east Europe in the 15th century, the Order retained its possessions and power through skilful liaison with the nobility and the military, particularly in the Habsburg Empire.