The town is known as the site of an incident known as the Frankenburger Würfelspiel (Frankenburg Dice Game). In 1625, during the Counter-Reformation, Lutheran peasants revolted against the attempt by the local landowner, Count Herberstorff, to impose a Catholic priest on the town. Despite his promise of amnesty, The Count had the town leaders arrested, divided them into groups of two, and forced each pair to gamble with dice for their lives. Thirty-six men were hanged. This act triggered the Upper Austrian peasants' revolt of 1626. The revolt was defeated and Catholicism was reimposed. In remembrance of the event, a festival has been held every other year since 1925, including performances at what is claimed to be the largest open-air theatre in Europe.
The play was denounced by the Austrian government and banned in Austria. After the Anschluss of 1938, the play was triumphantly staged by the Nazi authorities at Frankenburg and other places in Austria. Speeches were delivered at Frankenburg by Austrian Nazis proclaiming that Adolf Hitler (who was born not far away at Braunau-am-Inn) had avenged the Frankenburg peasants and delivered Austria from the "chains" of the Catholic Church.