There were always some small gifts/souvenirs offered at newsstands along the main and most representative shopping boulevard of former West Berlin - Kurfürstendamm.
What to buy: The Berlin mascot, a cuddly bear to hug and hold available in various sizes, with crown and sash, a heart or Berlin bear-flag. If you like them.
What to pay: From 1.30 € to 7.60 € for a small bear up to over 30 € for a large one.
Outside nearly every tourist attraction you will find street stalls selling mostly relics from the former GDR or Soviet Union. It is hard to tell whether or not they are genuine articles.
What to buy: Former uniforms, military hats and medals of the GDR.
Next to the eastside gallery are a couple of souvenir shops. The prices are not too bad. Bring your passport here too and you can get a stamp from Checkpoint Charlie dated from the day the Wall came down. Cost 1euro.
What to buy: Best buys would be a stamp from Checkpoint Charlie dated the day the wall came down. Cost 1 euro, used to be 1 dm but that is the joy of having the new currency!
Also there are some interesting books to buy about Berlins history and the history of the wall etc.
What to pay: Prices are about average.
Many souvenir shops in Berlin sell teddy bears - not surprising as the bear is a symbol of Berlin. There are two shops in Nikolaiviertel which sell these bears exclusively.
What to buy: A teddy bear of course!
What to pay: About 10 Euros for the small ones
I found some neat souvenirs (the kind I like to buy: postcards, cups, glasses, t-shirts) at good prices next to the Zoologischer Garten metro station area, where a big commercial area is located. There are some shops where you can find cool and not so expensive stuff. And I also found good deals at some souvenir shops located close to the Brandenburger Tor, not on the Tiergarten side but rather close to Unter den Linden area (where some of the most important foreign embassies are located). You just have to walk around, enter the shops and try to find the best deals... it's fun!
Visitors to Berlin are invariably amused by the little green man on the pedestrian traffic signals, I certainly was. Here's a shop which stocks a variety of fun items depicting the traffic light men.
This was one of the better souvenir shops I saw, though it was still rather pricey. I was tempted to buy some parts of the Berlin wall which were on sale here; but then I saw the price:)