Don 2, which sees Shah Rukh Khan reprise the title role, will be shot over 50 days in the German capital, The Hindu reports.
The second part of the Don series replaces earlier locations of Malaysia and France, which were used in the first film.
A spokesperson for Berlin tourism said: "It's exactly what we want. Don 2, a sequel to the blockbuster Don, is being supported by the Berlin-Brandenburg film promotion company Medienboard."
Medienboard managing director Kirsten Niehuus added: "The Indian superstar and the film location Berlin will make for a great couple before the largest audience in the world."
Don was selected for screening at the Berlin Film Festival in 2007.
