Charles II Francis of Austria (German: Karl II. Franz von Innerösterreich) (3 June 1540 – 10 July 1590) was an Archduke of Austria and a ruler of Inner Austria (Styria, Carniola, Carinthia and Gorizia) from 1564. He was a member of the House of Habsburg.

A native of Vienna, he was the third son of Ferdinand I, Holy Roman Emperor, and of Anne of Bohemia and Hungary, daughter of King Vladislaus II of Hungary and his wife, Anne of Foix-Candale. In 1559 and again from 1564 to 1568, there were negotiations for a marriage between Charles and Elizabeth I of England. Emperor Ferdinand I expected Elizabeth to promise in the proposed marriage treaty that Charles, as her widower, would succeed her if she died childless. The negotiations dragged on until Elizabeth decided that she would not marry the Archduke since he was a Catholic.^[1]

In 1563, Charles was also a suitor of Mary, Queen of Scots, with her uncle Charles, Cardinal of Lorraine, advising her to marry Charles to obtain assistance in governing Scotland. Mary disagreed, as did Charles's older brother Maximilian.

Unlike his brother, Emperor Maximilian II, Charles was a religious Catholic and promoted the Counter-Reformation, such as by inviting the Jesuits to his territory. However, in 1572, he had to make significant concessions to the Inner Austrian Estates in the Religious Pacifications of Graz and in the 1578 Libellum of Bruck. In practice, that resulted in tolerance towards Protestantism.

As the Inner Austrian line had to bear the major burden of the wars against the Ottoman Empire, the fortress of Karlovac, in Croatia, was founded in 1579 and named after him. Charles is also remembered as a benefactor of the arts and sciences. In particular, the composer Orlando di Lasso was one of his protégés, as was the music theorist Lodovico Zacconi.

In 1573, Charles founded the Akademisches Gymnasium in Graz, the oldest secondary school in Styria. In 1580, Charles founded a stud for horses of Andalusian origin in Lipica, Slovenia and thus played a leading role in the creation of the Lipizzan breed. In 1585, Charles founded the University of Graz, which is named Karl-Franzens-Universität after him.

He died at Graz in 1590.

Charles's mausoleum, in Seckau Abbey in which other members of the Habsburg family are also buried, is one of the most important edifices of the early Baroque in the south-eastern Alps. It was built from 1587 onwards by Alessandro de Verda and was completed by Sebastiano Carlone by 1612.

On 26 August 1571, Charles married his niece Maria Anna of Bavaria in Vienna. They had 15 children, 12 of whom lived to adulthood: