Philip married Elizabeth of Vermandois, elder daughter of count Raoul III of Vermandois. The same year as his father died, his wife inherited a major portion of Vermandois. This pushed Flemish authority further south, and threated to completely alter the balance of power in northern France.
But Elizabeth died without children in 1183, and soon after King Philip I of France seized Vermandois. Philip of Alsace next married Teresa, princess of Portugal, daughter of Afonso I of Portugal, first king of that country.
Philip had no children, and was succeeded in Flanders by his sister Margaret and her husband Baldwin V, Count of Hainaut.
Philip's predecessors had consolidated the Capetian power within these narrow limits, but he himself was overshadowed by the power of his uncles, William, archbishop of Reims; Henry I., count of Champagne; and Theobald V., count of Blois and Chartres.
Philip had reduced to a mere remnant the formidable continental empire of the Angevins, which had threatened the existence of the Capetian monarchy.
Philip's policy of building up a strong monarchy was pursued with a steadiness of aim which excluded both enthusiasm and scruple.
Philip increased the power of the crown over his vassals and over the royal domain by concentrating on his position as feudal overlord and by extending the scope of his administration, justice, and finance to cover all his subjects not just his tenants-in-chief, i.e., by becoming a national monarch.
Philip II was still in the process of establishing himself as a feudal monarch by conquering land and by enforcing his rights as overlord.
Philip insisted on his control of the church and in 1205/6 he ordered that priests who committed murder should first be defrocked by a church court and then punished by a royal court.