It is buying a 29 per cent stake in Frosch Touristik (FTi), one of Germany's largest tour operators, for pounds 17.2m.
The deal will form the central plank of its ambitious plan to grow rapidly in Continental Europe.
Airtours has stolen a march on its British rivals who have also been vying for a foothold in the German market.
Airtours has an option to take control of the group in 2002, and analysts believe that the company is likely to buy the whole of FTi as soon as possible.
Harry Coe, managing director of Airtours, said yesterday: "Germany is the real prize. All the UK tour operators have been looking at opportunities to get into the market."
Around 19 million Germans, almost a quarter of the population, took a package holiday last year. FTi specialises in providing tailor-made tours for Germans travelling to the US. It also provides long-haul holidays to the Caribbean.Reuse content