An investigation by Die Zeit daily highlighted Bauer's standing in the Nazi party, the organizers said on their Facebook page ahead of the festival, which starts on February 20th.
The organizers referred to a report published Wednesday in Die Zeit newspaper "which cast new light on the role of Alfred Bauer, the first director of the Berlin International Film Festival, in the film politics of
the National Socialists.
"The interpretation of these sources suggests that he had held significant positions during the Nazi era. In view of these new findings, the Berlinale will suspend the 'Silver Bear Alfred Bauer Prize' with immediate effect," the organizers said.
They added that "we welcome the research and its publication... and will seize the opportunity to begin a deeper research on the festival history with the support of external experts."
Die Zeit has carried out painstaking research notably by trawling through national archives. In doing so the publication found that Bauer, who directed the festival from 1951 to 1976, held a high rank in Nazi propaganda minister Joseph Göbbels's powerful Reich Film Directorate.
The weekly also found that, according to Nazi era documentation, Bauer belonged to the Nazi party and was "an avid SA man," the SA being the Nazi party's Sturmabteilung paramilitary wing.
Bauer, who died in 1986, whereupon the prize in his name was established, also played a key role in the surveillance of actors, producers and other members of the film industry which was in Göbbel's iron grip during the Third Reich.
After World War II Bauer sought to erase all traces of his Nazi past, according to Die Zeit, even putting it about that he had resisted the regime.
Six years after the regime's final demise with the end of the conflict he was named Berlinale director and helped the event become one of the three biggest global filmfests alongside Cannes and Venice.
This year's festival jury will be headed up by British actor Jeremy Irons to select a winning entry that is seen as opening up new perspectives in cinematic art.
Previous winning films include Alain Resnais's "Aimer, boire et chanter" (Life of Riley) (2014) and Zhang Yimou's 2003 film "Hero".
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