During World War II the amount of research done declines rapidly. In the final stages of the war the Institute' s facilities are badly damaged, and very little research is possible until the mid-1950s. The new research hospital, at 10 Kraepelinstrasse, is opened. It is under the direction of Detlev Ploog , head of the Clinical Institute. Gerd Peters is head of the Basic Research Institute and managing director of the Institute as a whole.
Research is expanded to cover all major areas of psychiatry and basic research in related sciences.
The Basic Research Institute, headed by Hans Thoenen, moves to a new building in Martinsried, west of Munich, on the same campus as the Max Planck Institute for Biochemistry. On the retirement of Detlev Ploog, Florian Holsboer becomes director of the Clinical Institute. The buildings on Kraepelinstrasse are renovated and a new laboratory wing is added.