"Prinz Eugen" was ordered by the "Kriegsmarine" from the Germaniawerft shipyard in Kiel. Her keel was laid down on 23 April 1936, under construction number 564 and the contract name "Kreuzer J". She was originally to be named after Wilhelm von Tegetthoff, the Austrian victor of the Battle of Lissa, though considerations over the possible insult to Italy, defeated by Tegetthoff at Lissa, led the Kriegsmarine to adopt Prinz Eugen as the ship's namesake. She was launched on 22 August 1938, in a ceremony attended by the Governor ("Reichsstatthalter") of the Ostmark, Arthur Seyss-Inquart, who made the christening speech. Also present at the launch were Adolf Hitler, the Regent of Hungary, Admiral Miklós Horthy (who had commanded the battleship from 24 November 1917 to 1 March 1918), and his wife Magdolna Purgly, who performed the christening. As built, the ship had a straight stem, though after her launch this was replaced with a clipper bow. A raked funnel cap was also installed.