That was a cynical phrase that meant "work will set you free", when the truth was that inmates were subjected to either immediate execution, painful scientific experiments or forced labour.
Ms Merkel, addressing a gathering of former inmates, she said she felt "deep shame in the face of the barbaric crimes committed by Germans here", the site of the most notorious site of the atrocities that Adolf Hitler's regime inflicted on Europe.
Merkel and Morawiecki went next to the site of executions, where they bowed their heads before two wreaths bearing their nations' colours.
They also visited a laboratory where the conservation is done before a ceremony where Merkel met former inmates and was to deliver a speech.
Merkel also brought a donation of €60 million ($66.6 million).
The money will go to a fund to conserve the physical remnants of the site - the barracks, watchtowers and personal items like shoes and suitcases of those killed.
Together, those objects endure as evidence of German atrocities and as one of the world's most recognizable symbols of humanity's capacity for evil.
But they also are deteriorating under the strain of time and mass tourism, prompting a long-term conservation effort.
That donation to the Auschwitz Foundation comes in addition to €60 million that Germany donated when the fund was launched a decade ago, according to the Auschwitz-Birkenau state museum.
As with the earlier donation, half comes from the federal government and half from the German states, an acknowledgement of the German nation's responsibility.
Since becoming chancellor in 2005, Merkel has paid her respects at other Nazi concentration camps, and she has been five times to Israel's Holocaust museum and memorial Yad Vashem.
Still, Poland's Foreign Ministry called her visit "historic", in an obvious acknowledgement of the unique status Auschwitz has in the world's collective memory. The ministry also noted that it was just the third visit of an incumbent head of a German government.
Nazi German forces killed an estimated 1.1 million people at the Auschwitz-Birkenau complex during their occupation of Poland during World War II.
Most of the victims were Jews transported from across Europe to be killed in gas chambers. But tens of thousands of others were killed there too, including Poles, Soviet prisoners of war and Roma, or Gypsies.
The camp was liberated by the Soviet army on January 27, 1945.