Restrictions will also be eased for unvaccinated visitors, who can leave quarantine early if they test negative for coronavirus.
However, the new rules will not apply to those travelling from countries where virus variants of concern are prevalent.
The measures were approved on Wednesday by Angela Merkel’s cabinet, reports AP.
The country expects to roll out its digital vaccine passport by the end of June to help enable safer and more seamless travel.
The aim is for the app to be compatible with the EU’s digital green pass.
“If we manage to do this for the EU in the coming weeks, then we'll likely set a global benchmark,” said German health minister Jens Spahn.
Around one third of Germany’s 83 million-strong population have received one dose of the vaccine so far, while one in 10 people have had both jabs.
In response to falling infection rates, a number of German states are easing pandemic restrictions in the coming weeks.
Bavaria has reopened its beer gardens, while open-air cultural events with up to 250 people and pre-booked swimming sessions in outdoor pools will be permissible from 21 May.
It comes as several European countries are gearing up for leisure travel to resume.
The Spanish government announced that British tourists will be able to enter the country without a negative PCR test from next week.
Tourism minister Reyes Maroto said that, thanks to the UK’s vaccine roll-out and declining infection rate, the testing requirement for entry would be abolished from 20 May.
The ban on international leisure travel from England lists on 17 May, with holidays able to resume under a traffic light system.