First of all the Treaty of Versailles was not nearly as devastating to Germany as much as the popular narrative assumes, or at least it was not as devastating as it potentially could have been. Britain did not want to see Germany treated harshly while France basically wanted to turn Germany into a agrarian state. France suffered massive casualties from World War I and with much of the western sphere of the war taking place in France, they figured that they had a good case for making sure that Germany never rose again. There was also the element of "revenge" for the Franco-Prussian war, hence the Treaty of "Versailles". In the end, Britain won out and Germany was given essentially a "slap on the wrist" that was followed by over a decade of appeasement. What really hurt the Germans was the Great Depression which destroyed their economy and created a vacuum for Hitler to take power.
Hitler's plan to revive Germany can be broken down into essentially three primary goals:
Massive spending from the government. Bridges, roads, and infrastructure are rebuilt. This is where we see the very start of rearmament. Volkswagen benefits greatly from this
Price controls and allocation of raw materials. Hitler wanted to make sure resources were allocated equally to prevent hoarding or wasting, the price controls were intended to create stability in the German economy.
Development of synthetic materials. Hitler did not want to have to depend on imports and exports, he wanted a self sufficient economy.
What followed was referred to as the "German miracle", the country returned to nearly full employment following these initiatives.
By 1935, Hitler was stepping all over the Treaty of Versailles as France's worst fears seem to be validated.
He creates an airforce, the "Luftwaffe", institutes conscription that raises the army from 96,000 men to 500,000 men. Back in 1923, the world had denounced France, calling them bullies for entering the Ruhr and attempting to grab coal as reparations. Hitler, aware of this, decides to remilitarize the Rhineland knowing that if the French attack, Germany will appear as the victim while France appears to be the aggressor. He sends 10,000 troops into the area and retakes it. It works.
By the time that he turns his eyes to Austria, France is forced to backdown, Germany has regained important territory, the economy is rebuilt and thriving, and they are a military force again.
TL:DR, the Treaty of Versailles was not enforced causing Hitler to walk all over it.