He was assigned a two-year teaching practicum; for the first year he served as a general assistant in Ebreichsdorf, and the second at the Schülerheim Vinzentinum in Klagenfurt.

On 15 October 2001, Pope John Paul II appointed him an auxiliary bishop for the Archdiocese of Vienna with the titular see of Simidicca.

Schwarz was appointed the Diocesan Bishop of Linz on 6 July 2005 by Pope Benedict XVI; he assumed that office on 18 September.

He enforced Catholic teaching that prohibited baptisms and preaching by lay people, and was more stringent about norms for the reception of the Eucharist.

[4] One of the biggest challenges Schwarz had to face was the controversy over the nomination of Gerhard Maria Wagner as auxiliary bishop of the diocese, known for his view that Hurricane Katrina was a punishment for New Orleans' sins.