Merkel, who ran unopposed, won 89.5 percent of delegates' votes at a congress of her Christian Democratic Union in the western city of Essen.
That was short of the 96.7 percent she won two years ago, but still a strong mandate as she prepares to seek a fourth term as chancellor in next year's German election.
The vote came after a speech in which she struck a decidedly conservative note, telling members that she wants to stem the influx of migrants and ban face-covering veils where possible.
"A situation like the one in the late summer of 2015 cannot, should not and must not be repeated," Merkel told delegates.
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While Merkel insists that Germany will continue to take in people who genuinely need of protection, her government has moved to toughen asylum rules and declare several countries "safe", meaning people from there can't expect to get refuge.
Polls show a solid lead for the conservatives, although their support is still short of the 41.5 percent they won in Germany's 2013 election. They face new competition from the upstart nationalist Alternative for Germany party, which has thrived by attacking Merkel's migrant policies.
"The 2017 election will be more difficult than any election before, at least since German reunification," Merkel said, citing the "strong polarization of our society." Merkel told delegates that "parallel societies" won't be tolerated and advocated banning the wearing of full-face veils used by some Muslim women where that's possible.
"Who the people are ... Is something that we will all determine, not just a few, however loud they may be," she declared.
The EU's longest-serving head of government has often said her aim is for Europe to emerge stronger from crises such as the debt troubles that afflicted the common euro currency. Merkel said she still believes in that - but "we must in this situation ... First do everything so that Europe doesn't emerge even weaker from the crises than when it went in.