"They have so many stars in their team and in our match they are the favourites," said Germany assistant coach Hansi Flick. "They play modern football, have gained a lot in tactical matters under Fabio Capello and can beat any team."
"This match will be an absolute classic," he added ahead of Sunday's showdown at the Free State Stadium in Bloemfontein.
England scraped through to the second round as Group C runners-up with a 1-0 win over Slovenia while Germany won by the same scoreline against Ghana on Wednesday to top Group D.
"England have so far not shown what they're capable of but they're one of the favourites to win the World Cup," said Flick.
"They may have not shown their full potential in the first games but they are experienced enough to now turn the switch. It will be a completely different match against us."
England were held to a 1-1 draw by the United States, who won the group, and had to settle for a goalless draw in a dull affair with Algeria before beating Slovenia to qualify.
Wayne Rooney has yet to score in this tournament but showed some signs of improvement on Wednesday before coming off with a slight ankle problem and England's chances could rest on him.
"I think Wayne Rooney has amazing qualities. He may not have peaked yet but when it comes to the crunch matches, players like him always deliver," said Germany defender Arne Friedrich.
"So we must consider ourselves warned. We cannot give away as much space as we did against Ghana," added the 31-year-old.
TWO EXTREMES
The Germany-England match-up has developed into one of the world's greatest rivalries and Friedrich said Sunday's meeting was between teams of "two extremes" - Germany's youngest World Cup squad in 76 years facing an experienced England side.
"If we're able to find this lightness we had in our (4-0 opening) win over Australia then this youth may be an advantage instead of a disadvantage," he said.
The biggest clashes between the teams include the 1966 World Cup final, which England won, and the 1990 World Cup and Euro 96 semi-finals both of which Germany clinched on penalties.
"We will, of course, prepare for penalties but hopefully we can decide the match in our favour before that," said Germany goalkeeper Manuel Neuer.
"But the people in the team will prepare me for that case and I will have to play the memory game (if it comes to a penalty shootout)," he added.
