Poland regained independence after World War I in 1918, and local Poles organized a pro-Polish rally, which was shut down by the local German police. Polish activists were sentenced to several months in prison, and then to exile. Despite Polish attempts at regaining control of the region, the Treaty of Versailles did not restore the pre-partition borders and the town remained within interwar Germany. In the subsequent years many German migrants resettled in and around Lauenburg, while many Poles, including Kashubians, left for the nearby Polish Pomeranian Voivodeship. The city's economy has declined and the nationalists, communists and Nazis gained popularity among the German population. The Poles were active in the Union of Poles in Germany. After the Nazis took power, Poles, as well as Jews, were persecuted. Under the leadership of Willy Fruggel a "Hochschule" for teacher education was established in the city in 1933. The football club SV Sturm Lauenburg played within Gauliga Pommern.