This article examines Germany’s response to the European migrant crisis of 2015–2016 by analysing immigration and identity debates in Germany and their impact on German politics. The refugee crisis sharply divided the European Union and raised questions relating to immigration, humanitarian assistance and the duties towards those fleeing war and persecution. In such a scenario, Chancellor Angela Merkel’s decision to admit more than a million refugees had deep ramifications not only for German politics but also European and international politics at large. After the initial wave of support subsided, xenophobic and right-wing factions emerged, and public opinion began to turn against Merkel. The emergence of such sentiments is at odds with Germany’s complicated relationship with nationalism and right-wing politics in the post-war era. It is this juxtaposition that the article aims to analyse; whether the response to the refugee crisis proves that Germany is on the path to becoming a more inclusive society despite the presence of deep-rooted xenophobic elements. In order to do so, this article has focused on the complex relationship between party politics, immigration trends and identity debates in Germany and its impact on contemporary German politics as a whole.