Germany's Interior Ministry said the Islamic Center Hamburg, or IZH, has long been under observation by the nation's domestic intelligence agency.
The activities of the IZH are aimed at spreading the "revolutionary concept" of Iran's supreme leader which is suspected of violating Germany's constitutional order, the Interior Ministry added.
German authorities are also looking into suspicions that the IZH supports banned activities in Germany that are run by Lebanon's Iran-backed Hezbollah militant group.
Since the war between Hamas and Israel started, Hezbollah has repeatedly traded fire with the Middle Eastern nation across the border with Lebanon.
IZH runs a mosque in Hamburg.
The Interior Ministry said German intelligence believes it exerts significant influence or full control over some other mosques and groups, and that they often espouse a "clearly anti-Semitic and anti-Israel attitude."
It said authorities are examining whether it can be banned, and material seized during the searches will be evaluated.
FILE —The "Blue Mosque", housing the Islamic Centre of Hamburg, is pictured during police raids accross Germany over suspected links to the Iran-backed Hezbollah group in Hamburg, northern Germany on November 16, 2023.
Wednesday's raids were carried out in Hamburg and six other German states — Baden-Wuerttemberg and Bavaria in the south, Berlin, and Hesse, North-Rhine Westphalia and Lower Saxony in the west and northwest. In addition to IZH, the investigation is also targeting five other groups suspected of being sub-organizations of it.
"Our measures show that we have the Islamist scene in our sights," Interior Minister Nancy Faeser said in Berlin. "I want to say very clearly that we are acting against Islamist extremism; we are not acting against a religion or another state."
"But it is just as clear that we don't tolerate any Islamist propaganda, anti-Semitic and anti-Israel agitation here," she added.
On November 2, Faeser implemented a formal ban on activity by or in support of Hamas and dissolved Samidoun, a group that was behind a celebration in Berlin of Hamas’ attack on Israel, following up on a pledge made by Chancellor Olaf Scholz shortly after the attack.
The IZH said last month that it "condemns every form of violence and extremism and has always advocated peace, tolerance and inter-religious dialogue."
The German federal prosecutor's office said separately that about 20 locations in the Hannover region were searched on Thursday in an investigation of five alleged members of Hezbollah who are accused of taking leading roles in two local groups steered by the militant organization.
They are being investigated on suspicion of membership in a foreign terrorist organization, prosecutors said. There were no arrests.