Hard disks containing up to 500 terabytes of data, including videos and photos, were seized from the cellar of a 27-year-old man from the western city of Muenster.
Investigators identified at least three potential victims aged five, 10 and 12 years old. Some of the suspects — who hail from regions across Germany — are related to the children.
Muenster police said in a press conference that the recovered footage showed shocking abuse over “several hours” of the two younger boys by four men.
“You can't imagine it,” said lead investigator Joachim Poll.
“These men, if you can call them that, acted maliciously by encrypting all their discussions on their cell phones.”
Police said the abuse took place at a summer house in Muenster belonging to the mother of the 27-year-old suspect.
Germany is still in shock over an earlier scandal in Luegde, 125 kilometres (80 miles) from Muenster, where several men abused children several hundred times at a campsite over a period of several years.