The planned suicide attacks were reported to be connected to ISIS, officials said.
Police have received "concrete information that strongly indicates that there are possible plans for terror attacks in Munich, specifically against the main train station and the railway station in (the western district of) Pasing."
Munich police said officials had deemed the information about the threat of an attack on New Year's Eve as serious and credible.
Authorities told the public additional officers were being called in to find possible suspects.
Another country's intelligence agency reported the plot and the ISIS connection to German federal police, Bavarian Interior Minister Joachim Herrmann told journalists.
Munich is the capital of the German state of Bavaria.
"The threat very specifically referred to midnight and to these two places," Herrmann said.
Between five and seven alleged terrorists were planning suicide attacks, Munich police president Hubertus Andrä told journalists.
"The concrete tip this evening came from one source," he said. Investigators have not been able to find suspects or further clues to shore up the tip.
In light of the threat, police had requested that the public to stay away from large gatherings.
Early Friday, police allowed both train stations to reopen, they announced in a tweet.
Europe has been on edge since the November 13 terrorist attacks in Paris that killed at least 130 people. Recent weeks have brought arrests of suspected terrorists in Belgium, France, Austria and other nations.