"From 9 a.m., we will resume work with 100% of air traffic," said a spokesperson for DFS, whose controllers monitor take-offs and landings at 15 international airports in Germany.
The problems, which started around 3 a.m. local time (0100 GMT), were caused by an unexpected issue during a software update overnight, which forced DFS to limit air traffic to 50% of normal capacity.
Pan-European air traffic agency Eurocontrol said on its website that there were moderate to high delays in many parts of German airspace on Wednesday, citing issues including computer problems with air traffic control equipment, staffing and the Ukraine crisis.
Frankfurt airport, one of Europe's busiest and a hub of flagship carrier Lufthansa, was affected in particular.
More than 4.5 million passengers travelled through the airport in May.
DFS said it was too early to say how many flights had been affected.
It said disruptions were likely to continue throughout the morning as a result of earlier cancellations.
Lufthansa said earlier that it expected delays and cancellations to destinations in Germany and Europe, particularly at Frankfurt, where it is the biggest airline.
It did not say how many flights could be affected.
The departures board on Frankfurt airport's website showed around 20 cancelled flights between 7.30 a.m. and 9 a.m. local time (0530 GMT to 0700 GMT).
Earlier, Frankfurt airport operator Fraport had warned that the problems would impact flights across Europe.