After discussions with district leaders Chancellor Angela Merkel said the current measures would remain in place until April 18.
The restrictions will be severe from April 1-5, when many stores will be closed and circles will be closed.
Ms Merkel said Germany was now in a "very bad" situation.
"The number of cases is increasing rapidly and the beds of the critically ill are overflowing," the chancellor told a news conference on Tuesday.
Coronavirus infection has been on the rise throughout Europe in recent weeks as countries struggle to vaccinate their people despite delays in releasing jabs.
The infection rate has risen to more than 100 per 100,000 people in Germany. Another 7 485 infections were reported in the last 24 hours and 250 deaths.
In other improvements:
French hospitals receive another 471 patients in the intensive care unit within 24 hours, with another 15,792 cases reported.
The head of the French hospital's federation, Frédéric Valletoux, says the figures are "exploding" and hospitals could be hit in the next two to three weeks by "a wave of unprecedented violence".
Danish political leaders have agreed to continue reducing its closure, with more children going to school from April 6 and hairdressers reopening
The Czech Republic estimates that 25,000 people have died with Covid-19 since the outbreak began, but the disease has receded last week.
Announcing the new limits after negotiations for the marathon race with leaders of eighteen German states, Ms Merkel said the vast diversity of the UK (Kent) coronavirus has become prominent in Germany, making the country what she calls a "new epidemic".
"Actually, we have a new virus," said the German chancellor. "It's very deadly, highly contagious and contagious for a long time." Germany was in a race against time to release anti-coronavirus vaccines, he added.
Tuesday's expansion marks a turning point earlier in the month, when world leaders agreed to begin a vigilant reopening process.
What are the new steps?
Existing measures, such as the closure of sports facilities, will remain in place until 18 April.
Thereafter, five days after Easter from April 1, Germans were asked to stay home and cut off their contacts:
Internal services are canceled
Large family gatherings are restricted, not allowing more than two households, or up to five people to meet
All stores are closed, with the exception of grocery stores on Saturday, April 3rd.
"Emergency arrest" will stop another reopening in areas where the infection exceeds 100 new cases per 100,000 people in seven days.
Denmark arranges Covid's passport
Among the measures agreed on Monday by Danish leaders is the proposed "corona approval", which will determine whether the owner has been vaccinated, previously infected or had been badly tested 72 hours ago. Children under the age of 15 will be released.
The purpose of the passport, which will be available on mobile and paper, will be to allow people who fill out the requirements to go to the hairdresser, restaurant or finally the cinema.
The current plan is to open small shopping centers from April 13 and officials from April 21, as well as outdoor food in cafes and restaurants. Movies and snacks will resume on May 6th.
Danish Prime Minister Mette Frederiksen said most of the restrictions would be lifted once all under-50s were vaccinated, which is expected to take place in May.
Why does the EU have vaccination problems?
EU-UK disputes over AstraZeneca jabs escalate
Covid - countries have nailed it
The roll-out of vaccines across the EU remains sloppy - far behind the average of the vaccines obtained by Israel, the UK and the US.
Part of the reason for that is the problems with the Oxford / AstraZeneca vaccine - now at the center of political controversy between the UK and the EU over the company's contractual obligations.
The EU is now considering an export ban aimed at producing AstraZeneca in Europe. EU officials complain that more vaccines go to the UK and other countries, than to stay in the EU.
Meanwhile, Hungary has become the first EU country to adopt the use of China's CanSino Biologics coronavirus vaccine and CoviShield, the Indian version of the AstraZeneca vaccine, reports Reuters.
EU nations are allowed to strike different deals with vaccine manufacturers who have not signed agreements with the EU. Hungary is already using the Chinese vaccine Sinopharm and the Russian vaccine Sputnik.
The EU regulator, the European Medicines Agency, has so far approved four vaccines - from Pfizer-BioNTech, Moderna, Johnson & Johnson and AstraZeneca.