The German Foreign Minister has invited the British ambassador to respond to reports of spying from the UK embassy. The Independent has suggested that Britain was operating a "covert listening station" in the German capital.
It claimed that "hi-tech equipment housed on the embassy roof" was being used.
The newspaper said it based its claims on documents leaked by whistleblower Edward Snowden, along with aerial photographs and "information about past spying activities in Germany".
An embassy spokeswoman confirmed that ambassador Simon McDonald attended a meeting at the German Foreign Ministry but would not give any more details.
A statement from the German Foreign Ministry also confirmed the meeting.
It said "At the instigation of Foreign Minister (Guido) Westerwelle, the British ambassador was asked to come for a talk at the Foreign Ministry".
"The Director-General for European Affairs asked for an explanation of current reports in British media and indicated that tapping communications from a diplomatic mission would constitute a violation of international law" it added.
The Independent claimed that leaked documents from the US National Security Agency (NSA) show that Britain is operating "a network of electronic spy posts from diplomatic buildings around the world, which intercept date in host nations".
It also reported that the US last week shut down a similar "nest" on the the roof of its own embassy in Berlin in a bid to heal relations with Germany.
The atmosphere between the two countries has grown tense since claims that US intelligence had bugged the mobile phone of German Chancellor Angela Merkel.
The Chancellor recently sent a number of senior officials to Washington DC to ask for an explanation over the claims.