Non-medical circumcision is a "serious and irreversible interference in the integrity of the human body,” the Cologne district court ruled.
This criminalises religious circumcisions performed by Jews and Muslims, the Financial Times Deutschland newspaper said on Tuesday. It says circumcision should be considered a crime of bodily harm.
Thousands of very young boys are circumcised in Germany each year, mainly for religious reasons.
In the United States most boys are circumcised shortly after birth - regardless of their religion, though the practice has declined in recent years and anti-circumcision protest groups have sprung up.
German doctors performing circumcisions that are not medically necessary have until now operated in a grey legal area. Until now they could claim that they were unaware that performing a circumcision is a crime.
Even if a physician was later found guilty by a court, there was a legal loophole and he could claim that the law was improper and avoid punishment. That is no longer the case, the Financial Times Deutschland said.
"The ruling is enormously important above all for doctors because it's the first time that they have a legal certainty," Holm Putzke of the University of Passau told the paper. He has been calling for prohibition for years.
“The court has, in contrast to many politicians, not allowed itself to be scared by the fear of being criticised as anti-Semitic or opposed to religion,” Putzke said.
"This decision could not only affect future legal rulings but in the best case it could lead to a change of consciousness among the affected religions when it comes to respecting the basic rights of children."
Jewish and Muslim groups have fought for years against a criminalisation of circumcision. They did not have any immediate comment on Monday's ruling, saying they needed to review it first, the paper said.
The court ruling is likely to be highly controversial – experts expect the matter will end up being decided by the Federal Constitutional Court.
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The Cologne decision came after a Muslim doctor performed a circumcision on a four-year-old boy. Two days later the mother brought the child to the emergency room because he was bleeding.
The prosecutor's office learned of the situation and filed charges against the doctor. The doctor was found not guilty in the first instance, but the prosecutor appealed.