"Market power and domination over central distribution channels should not endanger our cultural diversity," said the state minister for culture and media, Monika Grütters, of Chancellor Angela Merkel's ruling Christian Democrats (CDU).
Her statement "welcomes and supports" a campaign by authors, some of whom have been caught in the cross-fire as Amazon re-negotiates its deals with publishers.
German-language authors have accused Amazon of delaying the release of books and boycotting authors signed to publishing houses in dispute with the US company.
"If titles are removed from recommendation lists and deliveries are delayed to enforce discount demands from publishers, this is totally unacceptable," Grütters said, stressing that books are both "economic goods" and "cultural property".
More than 1,000 German-language writers have signed a petition protesting against Amazon's methods in its e-book price battle with Scandinavian publishing house Bonnier, a major player in German publishing.
Earlier, US writers had protested over Amazon's dispute with publishing conglomerate Hachette which represents authors including JK Rowling, Malcolm Gladwell and James Patterson, accusing the company of "taking writers hostage" in its e-books pricing battle.
Grütters said that "literature, books, publishing houses ... are a foundation of our cultural life".
"They must not be subject purely to market principles. Dealing appropriately with these values also has an ethical dimension. This applies to all players - including Amazon."