The main effect of the Treaty of Versailles on Germany was the imposition of harsh reparations and territorial losses following World War I. Signed in 1919, the treaty held Germany responsible for the war, leading to significant political and economic consequences. Germany lost territory, including Alsace-Lorraine to France and other regions to Poland, and its military was severely restricted. The reparations payments crippled the German economy, causing hyperinflation and widespread discontent. This environment of resentment and instability contributed to the rise of Adolf Hitler and the Nazi Party in the 1930s and ultimately set the stage for World War II.