Territory is a distinctive feature of modern international politics, but there is little consensus over what about it is distinctively modern. Recent scholarship in historical international relations (IR) takes modern territoriality to be defined by the practice of creating and enforcing borders. Scholarship therefore dismisses the 1648 Peace of Westphalia, once thought to be the origin of the sovereign territorial state, because it did not change border practices. However, this approach ignores legal history. I argue that territory is a legal concept, and a history of modern territoriality must explain under what conditions rulers expressed their authority as territorial in nature. This article explains why the legal evolution of territorial rights (landeshoheit, iure territorii) in early modern Europe was distinctive of the Holy Roman Empire (HRE). While national monarchies asserted their “sovereignty” as non-territorial in order to capture overseas empires, the HRE developed a legal doctrine of territorially circumscribed jurisdiction within the imperial hierarchy. The Peace of Westphalia was a culminating event in which diverse privileges were recast as a single territorial right. Territorial autonomy was not only consistent with the hierarchy of the HRE but was fundamental to preserving it. This article has two contributions. First, it adds to recent scholarship on modern territoriality by explaining how legal history furnished the preconditions for ruling territory. Second, it places Westphalia and the empire’s legal history within the recent turn toward empire in historical IR. An important source for the development of international law was the internal constitution of the HRE. This prompts us to reconsider the notion that international law assumes a world of sovereign territorial states. On the contrary, early international law concerned territorial states nested within imperial hierarchy, not the anarchy of sovereignty.