The study, from economically liberal Bertelsmann Foundation and Munich's Ifo Institute, found huge benefits for the country's exports – the cornerstone of the German economy – if a free trade agreement were signed between the US and EU.
Talks between the EU and USA are set to re-open on Monday over a free trade agreement.
A deal would sink trade costs, and mean German industries such as the food and metal industries could increase exports to the USA by 50 percent, the report said.
It added that all branches of industry and all regions of the country would reap the rewards.
Aart De Geus, head of the Bertelsmann Foundation to Spiegel Online news site: "Medium-sized businesses will benefit particularly, as well as large firms."
German manufacturing industries such as car production, electronics and engineering could create 85,000 new jobs, the authors said.
The service sector would also benefit from reduced trade costs with an estimated 75,000 jobs being created.
But it is Germany's export heartlands that would benefit the most. According to the report, North Rhine-Westphalia, Bavaria and Baden-Württemberg could see 20,000 new jobs and €5 billion in income.
According to the study, wages - which have long been depressed in Germany - will also increase. They estimated that unskilled workers could see a pay rise of 0.9 percent and skilled workers a rise of 0.7 percent.
It is hoped the deal between the US and EU will be agreed by the end of 2014.
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