With the arrival of the French government led by Napoleon Bonaparte the ghetto was abolished, as well as all other restrictions that existed for the Jews in the Republic of Dubrovnik. Even though the ghetto was never rebuilt, Jews who had houses and shops in the former ghetto continued to live there, just as the Jewish community continued to operate there.
With the dissolution of the Austro-Hungarian Empire after World War I, Dubrovnik came under the rule of the Kingdom of Yugoslavia. However, at the onset of World War II, it fell under the rule of the Independent State of Croatia (NDH). The NDH was led by the Ustasha movement, a Croatian fascist and ultranationalist organization active from 1929 to 1945.
Under the Ustasha regime, racial laws were swiftly enacted, targeting Jews and Roma, and imposing numerous restrictions on their lives. They were prohibited from entering cafes, visiting city beaches and swimming pools, and leaving their houses in the evening and at night, among other restrictions. Their businesses were seized by the Ustasha authorities, leaving many without a means of sustenance.
During this time, the military control in the city shifted to the Italians, who showed relatively more leniency towards Jews compared to the Ustashas. As a result, some Jews decided to remain in the city under the Italian rule. In early 1942, the majority of Jews were deported to camps in various locations in Dubrovnik, primarily to the Wregg Hotel and the camp in Kupari.