The 53-year-old German national, identified only as Yogendran G by the court in the northern city of Hamburg, was convicted of having raised funds in Germany from 2007-2009 for the Liberation Tigers of Tamil Eelam (LTTE).
The LTTE committed a string of attacks against civilian targets and national infrastructure during Sri Lanka's decades-long civil war that killed more than 100,000 people and ended in 2009 when government forces crushed the rebels.
The Hamburg court found that the man raised more than 81,000 euros (USD 88,000) for combat and terrorist activities including suicide attacks by the LTTE in its campaign for a separate Tamil homeland in the South Asian country.
But a court spokesman said today that he had later partially confessed in court to the charges against him, admitting to "collecting and transferring the funds" to the LTTE.
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The court, however, ruled that he was more than a member and actually "bore responsibility" within the group.
The prosecution and the defendant have one week to decide whether to appeal the verdict.
German authorities estimate that more than 1,000 LTTE supporters live in the country, mainly doing propaganda work and organising donation drives.