On 27 April 1955, East Germany and the Soviet Union signed an agreement by which Berlin Schönefeld Airport was transferred to civilian use (since 1945, it had been operated by the Soviet Army, with scheduled passenger flights having been operated by Aeroflot). As a consequence, the Council of Ministers of the GDR decided to set up a national East German airline, a move which was finalized on 1 July with the appointment of the company's initial management committee. Deutsche Lufthansa was chosen as the name for the airline (previously, it had been used by Deutsche Luft Hansa, the German flag carrier from 1926 to 1945), even though the branding rights had been purchased by West German Lufthansa in 1954.
Deutsche Lufthansa acquired a fleet of Ilyushin Il-14 aircraft, which were initially operated by Soviet crews. The first flight of the airline took place on 16 September 1955, by which East German prime minister Otto Grotewohl travelled to Moscow for a state visit. Scheduled passenger flights were launched on 4 February 1956 with the inauguration of the East Berlin-Warsaw service. In the same year, the route network was expanded to include Moscow and Sofia as its most remote points. On 28 March 1960, the Ilyushin Il-18 (a turboprop airliner) was put into service with Deutsche Lufthansa.
Because of the usage of the Lufthansa branding, the company was sued by West German Lufthansa. As a side effect, the East German airline was prevented from being admitted into the International Air Transport Association (it could not become a member of the International Civil Aviation Organization either, because at that time neither East nor West Germany had been accepted into the United Nations). As a consequence, Deutsche Lufthansa was liquidated on 1 September 1963. Its staff, fleet, and route network were transferred to Interflug, which had been founded as a state-owned charter airline in 1958 and served as the East German flag carrier thenceforth.
