In a fundamental revision of the 3rd edition from 2007, this work provides an updated comprehensive presentation of word formation in the German language of the 20th and early 21st centuries, incorporating the latest research literature. It outlines the basic principles of word formation for nouns, adjectives, verbs, and adverbs, addressing both the structural-morphological and semantic parameters of the formation models from both analytical and synthetic perspectives. The focus is on the principle of synchronous description, supplemented where necessary by historical linguistic explanations. New chapters have been added on the position of word formation within grammar and the relationship between word formation and the lexicon. Some fundamental questions have been re-evaluated, such as the classification of types of word formation, the morphological status of verb prefixes, and the group.