On July 3, 993 Potsdam was documented for the first time: The thirteen-year-old king of the East-Franconian-German Empire and later emperor Otto III gave his aunt, the abbess Mathilda of Quedlinburg, the place Poztumi. This settlement is presumed to have been in the region of the destroyed Heilig-Geist-Church. A castle complex was built close to the older Slavic settlement. The importance of Potsdam was based on controlling the crossing over the river Havel.
In 1536 a devastating fire destroyed large parts of the city. The reconstruction of the town resulted in an increase in size: In 1573 Potsdam counted 192 houses. The Thirty Years’ War destroyed the city again. In 1660 here were only 50 homeowners left in Potsdam.
In 1640 Elector Frederick William assumed the reins of government in Brandenburg. He chose Potsdam as his second residence besides Berlin. Shortly afterwards, construction of the representative City Palace was started at the old market square Alter Markt.
By decree of the Edict of Potsdam 1685, the Great Elector gave exiled French Huguenots a new home in the Margraviate of Brandenburg.