1740 - Development of the Royal Seat

Frederick II (known throughout history as Frederick the Great) converted Potsdam into an imposing royal seat. The creations from his era still define the city's image and character today. In 1744, the interior work the Stadtschloss (city palace) began, and a year later the construction of Schloss Sanssouci (Sanssouci palace) began. The plans for the palace on the vineyard came from Frederick II, its designer being architect Knobelsdorff.

In Sanssouci, the king gathered significant personalities of the 18th century – among them, Voltaire. Other than Georg Wenzeslaus von Knobelsdorff , the most important master builders of that time were, Carl von Gontard and Georg Christian Unger.  Along with other works, they built the Neuen Palais, the Bildergalerie (art gallery) and the New Chambers, and traces of their masterful work can still be found today in the cityscape of Potsdam.

After 1750, the Nowawes settlement (today's Potsdam-Babelsberg) was built outside the city by decree of Frederick II. Some of those who emigrated from Bohemia to escape religious persecution settled in Nowawes as weavers and spinners and formed the Weberviertel - the Weaver's Quarter. A number of their rural-style houses still exist, and in the center of the quarter is the Friedenskirche - the Peace Church – which was built under the orders of Frederick the Great.

The 19th century began for Potsdam with the entry of Napoleon. For two years Potsdam was the main cavalry depot for the French army - up to 6,000 soldiers and 12,000 horses had to be lodged. The duration of Napoleon's troops stay was a burden that cost the city some 850,000 Taler (a silver coin of considerable value in the currency of that time).
The first Prussian railroad was inaugurated in 1838 as the line between Potsdam and Berlin. At that time, the trains drove at speeds of 6 to 9 mph.

Frederick William IV has gone down in the annals of history as a great admirer of classical form. The king had his architect Karl Frederick Schinkel and the Royal Garden architect Peter Joseph Lenné build a multitude of splendid buildings and parks between 1826 and 1862. Charlottenhof palace, the Orangery, the facilities of the Pfingstberg Hill, the Friedenskirche, and the Church of the Redeemer in Sacrow are the most impressive buildings of that period.