A woman found the baby girl lying unconscious in the toilet cubicle at around 15.15 on Thursday afternoon, and immediately contacted the police, Bavarian police announced in a statement on Friday.
The baby was then taken by helicopter to a Munich hospital.
Police started to search for the mother but by Friday afternoon still had no indication as to her whereabouts.
Over forty police officers searched through the airport's two terminals for the mother on Thursday.
On Friday afternoon a police spokeswoman told The Local "doctors believe the baby has a good chance of survival.”
Police believe that mother gave birth to the baby in the adjacent parking lot or in the toilet cubicle itself.
Investigators are currently assessing CCTV footage for clues to the mother's identity and movements.
It is still unclear as to how the woman could have given birth without it coming to anyone's attention. The toilets are in the main parking lot in Terminal 2 which has around 7,000 parking spaces.
Investigators are also looking into the possibility that the mother caught a flight after giving birth and is now outside Germany.