It was not immediately clear what became of the device, which German media say was delivered to a pharmacy, beyond the fact that it had not exploded or hurt anybody.
Karl-Heinz Schroeter, interior minister of the state of Brandenburg, which surrounds Berlin, said the area would remain shut while police searched with sniffer dogs for any other similar packages.
Police in the city of Potsdam said the package did not appear to include any parts for detonation, but wires and a firecracker without a fuse were found inside the cylindrical object.
They later said that their officers had defused the explosive.
German police in Potsdam, near Berlin, defused a suspected incendiary or explosive package found in a street close to the city's newly-opened Christmas market.
However, police warned of speculation on Twitter and told people to avoid "premature conclusions".
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The scene at Potsdam's Christmas market, which was evacuated on Friday.
The country remains on high alert since the 2016 terror attack at a Christmas market in Berlin.
Security has been stepped up at all markets across Germany ahead of that anniversary, and the looming first Advent weekend.
In that case, a Tunisian man hijacked a truck and drove it into a crowded market, killing 12 people in an attack that was later claimed by the Islamic State group.
Anis Amri, fled to Italy after the 19 December attack and died in a shootout with police near Milan four days later.