Speaking after meeting Yemen's President Abdrabuh Mansur Hadi, Merkel said: "Firstly, we condemn the Syrian attacks in the strongest possible terms.
"But at the same time, we call on all sides to exercise restraint ... we are on the side of Turkey and the foreign minister has had contacts with Turkey ... but at the same time restraint is the order of the day," she added.
Earlier Thursday, German Foreign Minister Guido Westerwelle had also called for "prudence, for a measured handling of this worsening situation."
"It's now a question of de-escalation," Westerwelle told reporters.
He also urgently appealed to the regime of Syrian President Bashar al-Assad "to respect the sovereignty and also territorial integrity of Turkey and other neighbouring countries."
Turkey resumed pounding Syrian targets early Thursday, reportedly killing several soldiers, in retaliation for deadly cross-border fire that has sharply escalated tensions in the region.
On Wednesday, mortar fire from Syria crashed inside the Turkish border town of Akcakale, killing five civilians, including a mother and her three children.
Westerwelle said the events showed the risk that the 18-month long conflict in Syria posed to the region was growing, increasing the need for the international community to act.
"I appeal to all partners in the United Nations Security Council to be aware of their responsibility and not to reduce any longer the international community's ability to act through a blocking position," he said.
The EU's foreign affairs chief Catherine Ashton took a similar line earlier Thursday, saying: "I strongly condemn yesterday's shelling by Syrian forces of the Turkish border town of Akcakale, which killed five and injured many more."
"I call for restraint from all sides," she added.