The formation of the European Single Market and unification in particular is shaking the hierarchy and system of German cities. This holds strongly for East German cities, but most for Berlin-the re-united city and the new capital of Germany. In the first part of the paper the developments of the two halves of the city between 1945 and 1989 are described under the topics of political development and planning, population, housing and economic development. The second part describes the problems of the creation of the German urban system at 1990/1991 right after unification, in the fields of planning and policy, finance, population and economy. The last part gives some sceptical spotlights on future developments in the aforementioned fields.