The sale in July will be the culmination of a saga that started in 1938 with the Nazis seizing the Rothschild art treasures. The collection, belonging to the wealthy Barons Louis and Alphons von Rothschild, was looted by the SS on 12-13 March 1938, within 24 hours of the Anschluss, Hitler's annexation of Austria.
The Austrian government received the collection back after the Second World War when American GIs discovered it hidden in a ski resort in the Austrian Tyrol.
It is believed that Nazi officials intended to put the collection on display at the proposed Hitler Museum in Linz, the Fuhrer's home town.
The family had been trying to recover the treasures for many years. And in November 1998 the Austrian government finally passed a law whereby art looted by the Nazis was returned to its rightful owners.
Christie's has been asked to handle the sale of the 250 paintings, sculptures and items of furniture by the eldest Rothschild descendant, Bettina Looram, cousin of Lord Rothschild. She decided to auction the works of art as soon as the Austrian authorities gave permission for the collection to be exported.
The collection also contains scientific instruments, armour and rare Persian carpets.
Explaining the reasons for the sale, Christie's chairman, Lord Hindlip, said: "The palace in which this collection was housed was reduced to rubble, so were their investments, their factories, their wealth-producing powers. The Rothschilds in Austria suffered in financial terms more than in any other part of the world."
Among the paintings are three portraits by the Dutch Old Master, Frans Hals. One of the most striking is of the Amsterdam merchant Tieleman Roosterman. It is expected to fetch pounds 3.5m. Alexander Hope, an Old Masters specialist at Christie's auction house, said the painting is one of Hals' finest: "Hals is a master of characterisation. For this painting to come on the market is extraordinary," he said.
The furniture includes a royal commode by Jean-Henri Riesener, supplied to King Louis XVI in 1778.
There are also two 16th- century manuscripts. One of them, worth pounds 3m, is the Rothschild Prayer Book containing 67 full-page miniatures. It is considered one of the great achievements of Renaissance manuscript illumination.