After the Nazi seizure of power, Dietl took command of the 3rd Mountain Division. In April 1940, Dietl was assigned the task of capturing Narvik in northern Norway, the most difficult part of the German invasion of Norway and Denmark. Dietl's troops occupied Narvik, but a few days later Allied forces began the reconquest of the area. Allied superiority forced Dietl to withdraw, but he continued resistance even when Hitler was willing to accept surrender.
Shortly before a likely German defeat at Narvik, the Allies recalled their troops from Norway to France because of the German offensive there. Nazi propaganda made Dietl a hero. In July 1940, Hitler awarded him the Oak Leaves to the Knight's Cross. On 29 June 1941—one week after the beginning of Operation barbarossa, the German invasion of the Soviet Union—Dietl's division launched an attack toward Murmansk. Dietl's task was to cut the railway connecting the Murmansk harbor with the interior of the Soviet Union, but this effort failed.
In June 1942, Dietl was promoted to colonel general and received command of the 20th Mountain Army in Finland. On 23 June 1944, after visiting with Hitler, Dietl died when his airplane crashed near Hochwedel (Austria). Hitler delivered the funeral oration for one of his most devoted followers within the Wehrmacht.
Kaltenegger, Roland. Generaloberst Dietl: Der Held von Narvik. Munich: Universitas, 1990.; Ziemke, Earl. The German Northern Theater of Operations, 1940–1945. Washington, DC: U.S. Government Printing Office, 1960.