Addressing her conservative Christian Democratic Union (CDU) party, Ms Merkel said she would support a nationwide prohibition on Islamic veils covering the face.
“The full-face veil is not acceptable in our country,” she told delegates in Essen, sparking rapturous applause. “It should be banned, wherever it is legally possible.”
Thomas de Maizière, the German interior minister and one of Ms Merkel’s closest allies in the CDU, proposed a partial burqa ban in August and called the veils “contrary to integration”.
He said the law would apply in “places where it is necessary for our society’s coexistence” including government offices, schools and universities, courtrooms as well as demonstrations.
Dutch MPs voted for a similar prohibition in the Netherlands last month, covering public transport, education, healthcare and government buildings and punishing any infractions with fines.
Support for bans on full-face veils has been growing across Europe since France became the first country to implement such a law in 2011, followed by countries including Belgium, Bulgaria and parts of Switzerland.
Ms Merkel is running unopposed for a new term leading the CDU, who first elected her chairwoman in 2000, to launch her bid for a fourth term as German Chancellor.
Two years ago, she won the support of 96.7 per cent of party delegates, one of her best results.
But popularity has been severely dented by growing anti-migrant sentiment in Germany following the arrival of around 1 million asylum seekers in the continuing refugee crisis.
Ms Merkel has been widely criticised for her decision to open the borders in September 2015, with opponents blaming the policy for mass sexual assaults on New Year’s Eve in Cologne and two terror attacks by Isis supporters.
She has repeatedly refused to reverse the policy amid a string of regional election defeats for her CDU party but struck a new tone on Tuesday.
“A situation like the one in the late summer of 201 cannot, should not and must not be repeated,” she said. “That was and is our, and my, declared political aim.”
While Ms Merkel has continued to insist that Germany will take in people in genuine need of protection, her government has moved to toughen asylum rules and declare several countries ”safe“ – meaning people from there cannot expect to receive protection in Germany.
She was also a driving force behind an agreement between the EU and Turkey earlier this year aiming to stop crossings over the Aegean Sea by detaining migrants in Greece under the threat of deportation.
As well as discord over her policy on refugees, members of the CDU have also been unhappy about a perceived shift to the left during her 11 years as Chancellor.
Polls show a solid lead for the party, though their support is well short of the 41.5 per cent they won in Germany’s 2013 election.
They face new competition from the populist Alternative for Germany (AfD) party, which has thrived by attacking Ms Merkel’s policies on refugees and supports burqa bans as part of a wider anti-Islam stance.