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It is the site of the Berlin City Palace (in German, Berlin Stadtschloss). From 1948 to 1990 it was in East Germany.
In 1950 the remains of the city palace were blown up and the square was renamed Marx-Engels Platz. New buildings erected included the Palast der Republik, the Council of State building and the Foreign Ministry building.
The Council of State building contains a balcony from the former city palace. This balcony was used by Karl Liebknecht to proclaim a socialist republic on November 9, 1918.