East Germany, officially the German Democratic Republic (GDR; German: Deutsche Demokratische Republik, pronounced [ˈdɔʏtʃə demoˈkʁaːtɪʃə ʁepuˈbliːk] (listen), DDR, pronounced [ˌdeːdeːˈʔɛʁ] (listen)), was a state that existed from 1949 to 1990, the period when the eastern portion of Germany was part of the Eastern Bloc during the Cold War. Commonly described as a communist state in English usage, it described itself as a socialist “workers’ and peasants’ state”. It consisted of territory that was administered and occupied by Soviet forces following the end of World War II—the Soviet occupation zone of the Potsdam Agreement, bounded on the east by the Oder–Neisse line. The Soviet zone surrounded West Berlin but did not include it and West Berlin remained outside the jurisdiction of the GDR.
The GDR was established in the Soviet zone while the Federal Republic of Germany, commonly referred to as West Germany, was established in the three western zones. A satellite state of the Soviet Union, Soviet occupation authorities began transferring administrative responsibility to German communist leaders in 1948 and the GDR began to function as a state on 7 October 1949. However, Soviet forces remained in the country throughout the Cold War. Until 1989, the GDR was governed by the Socialist Unity Party of Germany (SED), although other parties nominally participated in its alliance organization, the National Front of the German Democratic Republic. The SED made the teaching of Marxism–Leninism and the Russian language compulsory in schools.
The economy was centrally planned and increasingly state-owned. Prices of housing, basic goods and services were heavily subsidized and set by central government planners rather than rising and falling through supply and demand. Although the GDR had to pay substantial war reparations to the Soviets, it became the most successful economy in the Eastern Bloc. Emigration to the West was a significant problem as many of the emigrants were well-educated young people and weakened the state economically. The government fortified its western borders and built the Berlin Wall in 1961. Many people attempting to flee were killed by border guards or booby traps such as landmines. Those captured spent large amounts of time imprisoned for attempting to escape.
In 1989, numerous social, economic and political forces in the GDR and abroad, one of the most notable ones being the peaceful protests starting in the city of Leipzig, led to the fall of the Berlin Wall and the establishment of a government committed to liberalization. The following year, a free and fair election was held and international negotiations led to the signing of the Final Settlement treaty on the status and borders of Germany. The GDR dissolved itself and reunified with West Germany on 3 October 1990, becoming a fully sovereign state in the reunified Federal Republic of Germany. Several of the GDR’s leaders, notably its last communist leader Egon Krenz, were prosecuted by the Federal Republic after reunification for offenses committed during the Cold War.
Geographically, the GDR bordered the Baltic Sea to the north, Poland to the east, Czechoslovakia to the southeast and West Germany to the southwest and west. Internally, the GDR also bordered the Soviet sector of Allied-occupied Berlin, known as East Berlin, which was also administered as the state’s de facto capital. It also bordered the three sectors occupied by the United States, United Kingdom and France known collectively as West Berlin. The three sectors occupied by the Western nations were sealed off from the GDR by the Berlin Wall from its construction in 1961 until it was brought down in 1989. (Source)