The German Grand Prix (Großer Preis von Deutschland) was held for the first time in 1926 on the AVUS and from 1927 to 1976 on the Nordschleife of the Nürburgring (the exceptions being 1959 on the AVUS and 1970 on the Hockenheimring circuit).

1 August 1954: The streamlined vehicles from Mercedes had a clear edge on the high-speed stretches, but enjoyed no such advantage on the many curves of the Nürburgring. As a consequence, Fangio, Kling and the pre-war driver Hermann Lang were given a lighter, single-seater (open-wheel) version of the W 196, while Hans Herrmann still had to make do with a fully clad model, as only three monoposto vehicles were ready for action. The race distance was extended from 16 to 22 laps and by over 500 km, thus becoming the longest Formula One race, with the exception of the Indy 500. The reigning World Champion Fangio led right from the start, but was soon put under pressure by Karl Kling who, due to a leaking tank, had started from the rearmost position of the 20 cars and, during his effort to catch up, ran the fastest lap in 9:55.1 minutes (138.0 km/h). Shortly before the end, Kling dropped back to fourth position because of a damaged shock absorber. Fewer than half the drivers reached the finish line.

Fangio won after 3:45:45.8 hours (501.82 km) with a lead of 1:37 minutes on the works Ferrari of Gonzales/Hawthorn. With wins in 6 races out of 9, Fangio ended the season as World Champion for the second time.