The hunting lodge of Augustusburg was built from 1568 to 1572 above the town of the same name on a hill called the Schellenberg on the northern edge of the Ore Mountains of Germany. The castle, which is visible from afar, is a local landmark. It lies about 12 kilometres east of the city of Chemnitz and about 21 kilometres southwest of Freiberg in the Free State of Saxony.
In building a new castle, Prince Elector Augustus wanted not just to create a prestigious palace for his hunting trips, but also to underline his leading position in Central Germany. The immediate occasion for its construction was his victory in the Grumbach Brawl. By enforcing the imperial ban on his Ernestine rivals - John Frederick the Middle and outlawed knight, Wilhelm von Grumbach, who sought refuge with John Frederick - the Albertine elector, Augustus, was able secure his supremacy over the Ernestines. He was also given the Ämter of Weida, Ziegenrück and Arnshaugk, which belonged to what later became the district of Neustädter Kreis. Thanks to the thriving economy of the Electorate of Saxony under Moritz and Augustus, the necessary finance for the construction of the castle was available.