Although the meeting was closed to the press, the transatlantic relationship between Germany and the US was likely to be at the centre of the discussion.
Relations between the US and Germany have deteriorated considerably since Obama's Republican successor Donald Trump took office as US President.
A political friendship had developed between Merkel and Obama during his eight-year term in office, with Obama also visiting the Chancellor in 2013 and 2017.
Merkel is due to travel to the US at the end of May for a speech at the graduation ceremony of the US elite Harvard University – but apparently is not planning a detour to Trump in Washington.
'Confident and optimistic'
Obama has been in Germany since Thursday. That evening he spoke before an audience of 14,000 in Cologne's Lanxess Arena.
The politician said he was “confident and cautiously optimistic” that the United States would soon be a leader in climate protection again.
He said he understood that many people are frustrated by the attitude of the current US government. But they shouldn't forget that the liberal state of California, for example, is consistently implementing the Paris Climate Agreement, he said.
Hope lies in young people, he said: “If all young people went to the polls and voted for climate-friendly parties, they could bring about change very quickly.”
Obama also stressed that decisions and discussions must be based on facts. “I am a great supporter of enlightening values such as facts, reason and logic,” said the 57-year-old. “A democracy defines itself by allowing for different opinions, but it cannot function when fundamental facts are challenged.”
Obama is due to take part in a 'town hall' meeting in Berlin on Saturday. He wants to answer the questions of around 300 young people from all over Europe who are involved in areas such as civil society, integration and food security.
Obama has already been to Berlin several times. Most recently, he took part in a panel discussion with Merkel at the “Church Day” (Kirchentag) in May 2017, speaking in front of the Brandenburg Gate which once divided the former East and West Germany.