In an operation involving hundreds of officers in 60 cities on Tuesday, police seized documents and files as security authorities issued an official ban on the DWR (True Religion) group.
Security officials say more than 140 youths had travelled to Syria and Iraq to join Islamic State (IS) fighters after taking part in the group’s campaigns in Germany.
They also distributed German language copies of the Koran across the country.
No arrests were made during the raids, but German interior minister Thomas de Maiziere said: “The translations of the Koran are being distributed along with messages of hatred and unconstitutional ideologies.
“Teenagers are being radicalised with conspiracy theories.”
The ban on DWR comes a week after authorities arrested five men who allegedly helped IS in Germany by recruiting members and providing financial and logistical help.
The recent operations suggest that the German government is trying to clamp down on radical Islamists.
The German interior minister stressed the ban does not restrict the freedom of religion in Germany or the peaceful practice of Islam.
But he said the group had glorified terrorism in the fight against the German constitution in videos and meetings.
“We don’t want terrorism in Germany and we don’t want to export terrorism,” Mr de Maiziere said.
Chancellor Angela Merkel has been under pressure to harden her line on security after a string of attacks claimed by IS across Europe and criticism of her decision to let in about 900,000 migrants last year.
The government has also banned five other organisations accused of having Islamist-jihadist aspirations since 2012.