The diamond pattern in heraldry is called a lozenge and dates back to Otto II of Bavaria (1206-1253). In 1242, he inherited the county of Bogen on the Danube, which was a rich trading area. As was common for heraldry, he incorporated Bogen's blue and white lozenges into the Wittelsbach family crest. The lozenge pattern became the default banner for Bavarian armies and grew more prominent in Bavaria during the Napoleonic Wars. In 1835, the Bavarian king Ludwig I redesigned the coat of arms for Bavaria, with the lozenge at the epicenter of the design.

The lozenge design's simplicity and distinctiveness have lent itself well for Bavaria after the abdication of the Wittelsbach following World War I. Even in a nation that prides itself on its regional distinctiveness, Bavaria has a strong independent streak within Germany (in its many manifest forms: imperial, Weimar, Third Reich, FRG). It is one of the most Catholic and religious of the German states and its local culture is very distinctive. One imperfect analogy that is sometimes used is that Bavaria is the Texas of Germany: a large state with a very distinctive sense of its own identity. For example, Oktoberfest is much more of a Bavarian phenomenon than a pan-German one. Many common American stereotypes of a "Germany" that do not fall under an eins, zwei, drei mechanistic rubric tend to be Bavarian in origin (lederhosen, dirndl, a lot of German cuisine).