Step 1: Background.
The story "The Last Lesson" by Alphonse Daudet is set in Alsace during the Franco-Prussian War (1870–71).
Step 2: Announcement.
M. Hamel, the French teacher, informed students that this would be their last French lesson.
Step 3: Reason.
The Prussian authorities had ordered that only German be taught in Alsace and Lorraine schools. This decision meant that French would no longer be taught.
Step 4: Conclusion.
Thus, M. Hamel declared that day's class to be the last French lesson.
Final Answer: \[ \boxed{\text{French was replaced by German in schools of Alsace and Lorraine.}} \]