After participating in World War I, Dostal worked as the theatre Kapellmeister in Innsbruck, St. Pölten, Vienna, Chernivtsi and Salzburg, before moving to Berlin in 1924, where he turned his hand to secular music.
He worked in music publishing and as a freelance arranger for Oscar Straus, Franz Lehár and Robert Stolz, among others.
Whilst working as a Kapellmeister and composer, Dostal wrote the music for the film The Emperor's Waltz (1933) and enjoyed great success with his first operetta Clivia.
In 1946 Dostal moved to Vienna, then in 1954 to Salzburg, where he continued to devote himself to composition, writing there among other pieces the chamber musical So macht man Karriere (1961) (How To Make a Career).
In 1942 he married the opera singer Lillie Claus, by whom he had one son, Roman Dostal, later a conductor.