A total of 884 of 919 delegates - 96.7 percent of the vote - elected Merkel on Tuesday as their leader for the eight time at the 27th Congress of the CDU party in Cologne, Germany's fourth-largest city. Five votes were declared invalid.
It was the second-best result of the 60-year-old conservative politician, who has headed the party since 2,000.
Her best-ever result was in 2012, when she earned support of 97.9 percent of party delegates.
The vote has further strengthened Merkel’s position in her party.
Only two historical political figures, former chancellors Helmut Kohl and Konrad Adenauer, earned better results in the history of the Christian Democrats.
Chancellor Merkel, who has led the country since 2005, has recently enjoyed popularity ratings close to 70 percent, according to a recent poll by public broadcaster ARD.
Public support for Merkel is well above the support for her party CDU.
A total of 56 percent of Germans have expressed support for Merkel’s fourth term as Chancellor in the next elections scheduled for 2017, in a poll by the Emnid institute.
Support for Merkel’s conservative CDU/CSU bloc is 35 percent, according to a poll published by the Bild newspaper last week.
In a speech at the party congress on Tuesday, Merkel emphasized that her coalition government has achieved significant success in the economy in recent years, despite the negative effects of the finance crisis in Europe
Merkel said unemployment had decreased to a record low in 2014 and the government had adopted budget with no new debts.
She expressed hope that Europe would overcome the crisis but also underlined that EU member states had to step up reform efforts and "stick to the rules" on budgets.
Merkel said: "We shouldn’t be depressed. I am totally convinced that we have all the chances to overcome this crisis.
"The European debt crisis was, in its essence, a crisis of confidence and, in order to win confidence again, we should all comply with the rules,” she said.
Merkel defended her government’s foreign policy in Ukraine and renewed her criticism of Russia over the annexation of Crimea.
"What has happened in Ukraine has put into question the peace order in Europe," she said adding that Russia had violated international law.
"As I have said in the beginning of this crisis, there is no military solution to this conflict. We should undertake every diplomatic effort for a political solution," she added.
Vitali Klitschko, a prominent Ukrainian politician and the current mayor of Kiev, was among the foreign guests at the congress of Christian Democrats.
CDU’s party congress will continue until Thursday with discussions on the economy and domestic and international matters.