The European Union could be forced to bring back border controls in the wake of the migrant crisis, warns Angela Merkel.
The German Chancellor said for the first time that the Schengen zone, which allows passport-free travel across mainland Europe, cannot continue in its current form unless other EU countries accept their share of migrants.
Mrs Merkel said that while she did not want freedom of movement rules to be tightened, the issue would arise if responsibility for accepting migrants was not shared.
Her comments echo those made by Thomas de Maiziere, the German interior minister, who also raised the prospect of border controls earlier this month.
And they signal that European leaders are beginning to question whether the EU can continue to exist with open borders as it struggles to cope with the hundreds of thousands of migrants coming into the continent from Africa and the Middle East.
Speaking in Berlin, Mrs Merkel said: "Europe as a whole needs to move. Member states must share responsibility for asylum-seeking refugees."
Germany, Europe’s biggest economy, is set to receive 800,000 asylum seekers this year, four times the total for 2014 and more than any other EU country."If we don't arrive at a fair distribution then the issue of Schengen will arise - we do not want that,” Mrs Merkel added.
“We stand before a huge national challenge. It will be a central challenge not only for days or months but for a long period of time.”
Her comments came as Austria imposed tough new controls along its eastern border with Hungary on Monday.
Queues of cars stretched back 18 miles into Hungary as Austrian police checked every vehicle on the Budapest-Vienna motorway in an attempt to crack down on traffickers smuggling asylum-seekers into the EU.
Austrian police say more than 200 others were recovered alive on Sunday night.
In an impassioned speech about Ireland's shameful failure to do more to help refugees in Europe, former Justice Minister Alan Shatter said the country had lost its "moral compass" because the "doors of the State were firmly closed to families trying to escape from persecution and death".
A couple of mornings ago, I walked the beach adjacent to the main port of Kos. On one end of the strip, holidaymaker sunbathe and swim in the shade of the large yachts; enjoying themselves as they should in what is a beautiful part of the world.
German Chancellor Angela Merkel called on other European Union countries on Sunday to take a greater share of the refugees fleeing to the bloc, as her government struggles to cope with a record number of arrivals.