Following elections on September 27, Merkel's Christian Democrats (CDU) and their CSU Bavarian allies were able to ditch their previous coalition partners, the centre-left Social Democrats (SPD), and switch to the pro-business Free Democrats (FDP).
CHANCELLOR: Angela Merkel (CDU), 55, became in 2005 Germany's first chancellor from the former communist East Germany, its first female leader and its youngest. A physicist by training and the daughter of a pastor, she rose to power first as a protege of former chancellor Helmut Kohl. Forbes magazine's most powerful woman in the world four years running.
FOREIGN MINISTER: Guido Westerwelle, 47, takes the Foreign Ministry as is traditional for leaders of the FDP in coalitions with the CDU/CSU. A lawyer by training, he has little experience in foreign affairs but says he will stand by "basic tenets" of German postwar policy. He will be Europe's first openly gay foreign minister, having publicly "come out" at Merkel's 50th birthday bash.
FINANCE MINISTER: Wolfgang Schäuble (CDU), 67, moves from interior minister to finance minister, charged with balancing the books amid sharply rising debts. Wheelchair-bound since an attack on his life in 1990, the veteran conservative was a close ally of former chancellor Helmut Kohl.
DEFENCE MINISTER: Karl-Theodor zu Guttenberg, 37, from the CSU, the Bavarian sister party of Merkel's CDU. The baron with the slicked-back hair raised eyebrows when he was named economy minister in February, but he has shot past Merkel to become Germany's most popular politician. His main task will be overseeing Germany's unpopular mission in Afghanistan.
ECONOMY MINISTER: Rainer Brüderle (FDP), 64, deputy chairman of the pro-business Free Democrats since 1998. The wine buff, silver-haired veteran was touted as a possible economy minister under Kohl in the late 1990s but missed out before the FDP was consigned to 11 years in opposition in 1998.
INTERIOR MINISTER: Thomas de Maiziere (CDU), 54, Merkel's trusted lieutenant since 2005 as her chief of staff, has been rewarded for his loyalty with the post of interior minister. His main tasks will be tackling the threat of Islamic extremism and fostering better integration of ethnic minorities.
FAMILY MINISTER: Ursula von der Leyen (CDU), 51, a popular mother of seven, will continue as family minister. In the previous government she introduced a raft of measures aimed at lifting Germany's traditionally low birth rate including increased benefits for stay-at-home parents and more kindergartens.
LABOUR MINISTER: Franz Josef Jung (CDU), 50, switches from defence to labour at a time of growing unemployment brought on by the economic crisis.
HEALTH MINISTER: Philipp Rösler (FDP), a 36-year-old surgeon, is the youngest member in the cabinet. He was adopted as a nine-month-old baby from Vietnam by a German couple and brought up in Germany. A rising star in the FDP he is currently minister for the economy and deputy premier in the state of Lower Saxony around Hannover.