Berlin is divided into boroughs or administrative districts (Verwaltungsbezirke). In Berlin, the term is officially shortened to Bezirke (districts). The boroughs are further divided into quarters (Ortsteile). These smaller localities are officially recognised, but have no administrative bodies of their own. Quarters and many of their subunits, the neighborhoods (Ortslagen), typically have strong identities that sometimes predate their inclusion into the modern boundaries of Berlin. Both the boroughs and the quarters function differently to other subdivisions in Germany due to Berlin's dual status as an independent city (kreisfreie Stadt) as well as a federated state of Germany (Land) in its own right.

Since 2001, Berlin has been made up of twelve boroughs, each with its own administrative body. However, because Berlin is a single municipality (Einheitsgemeinde), its boroughs have limited power, acting only as agencies of Berlin's state and city governments as laid out in the Greater Berlin Act of 1920. The boroughs are financially dependent on state donations, as they neither possess any taxation power nor own any property. This is in contrast to municipalities and counties in other German states, which are territorial corporations (Gebietskörperschaften) with autonomous functions and property.

Each borough is administered by an assembly of borough representatives (Bezirksverordnetenversammlung), directly elected by proportional representation, and a district office (Bezirksamt) led by a borough mayor (Bezirksbürgermeister), elected by the borough representatives. The district office is in charge of most administrative matters affecting its borough's residents, but its decisions can be revoked by the Berlin Senate. The borough mayors form a council of mayors (Rat der Bürgermeister), led by the city's governing mayor, and the council advises the Berlin Senate.

Each borough is made up of several officially recognized smaller districts or quarters (Ortsteile). The number of quarters that form a borough varies considerably, ranging from two (Friedrichshain-Kreuzberg) to fifteen (Treptow-Köpenick). Most of Berlin's quarters are further composed of even smaller so-called Kieze (neighborhoods), officially called Ortslagen. The number of officially recognized neighborhoods in Berlin's quarters also varies greatly, ranging from two (Kreuzberg) to many more in older quarters, for example nine in Mitte, with many more unofficial neighborhoods and neighborships having formed over the decades. The quarters of Berlin and many of their neighborhoods typically have a historical identity as former independent cities, villages, or rural municipalities that were united in 1920 as part of the Greater Berlin Act, forming the basis for the present-day city and state. Berliners often identify more with the quarter where they live than with the borough that governs them, and in larger or older quarters, the smaller neighborhoods have often become the defining social spheres for their residents. The quarters do not have their own governmental bodies, but for urban planning and statistical purposes, the quarters are officially recognized and further subdivided into statistical zones and lebensweltlich orientierte Räume (lifeworld-oriented regions). These areas correspond roughly, but not exactly, with the official and unofficial social and historical neighborhoods recognized by residents.

When Greater Berlin was established in 1920, the city was organized into twenty boroughs, most of which were named after their largest component quarter, often a former city or municipality; others, such as Kreuzberg and Prenzlauer Berg, were named for geographic features. Minor changes to borough boundaries were made in 1938. After World War II, Berlin was divided into four sectors, with the Western sectors controlled by the United States, Britain, and France, and the Eastern sector controlled by the Soviet Union.

In 1961, the SED built the Berlin Wall to divide the city, effectively separating West Berlin from East Berlin and the rest of East Germany. Three new boroughs were created in East Berlin: Marzahn was split off from Lichtenberg in 1979, Hohenschönhausen from Weißensee in 1985, and Hellersdorf from Marzahn in 1986. In 1989, the Berlin Wall fell, and the city was reunified. This marked the end of the Cold War and the beginning of a new era in Berlin's history.

After reunification, Berlin underwent a process of rapid transformation, as the city worked to rebuild and modernize its infrastructure and economy. Many new businesses and cultural institutions were established, and the city became a center of creativity and innovation.

By 2000, Berlin comprised twenty-three boroughs, as three new boroughs had been created in East Berlin. Today Berlin is divided into twelve boroughs, reduced from twenty-three boroughs by Berlin's 2001 administrative reform.