No other institute of the Kaiser-Wilhelm Society suffered as severely from the takeover by the National Socialists as this one. After having been told to dismiss all racially undesirable staff members, Fritz Haber submitted his resignation as director of the institute in a letter to the Prussian Minister for Science, Culture and Education on the 30th April 1933 and requested permission to retire on the 1st October 1933. His own dismissal had not been demanded by the Nazis but Haber was not willing to submit himself to such instructions. The Department heads Freundlich and Polanyi resigned and left Germany. This development hit Haber hard. He had been suffering for a long time from angina pectoris and had already given consideration to the choice of his successor, the most likely candidate being James Franck. Now he saw his lifetime work in shambles, and his exile was the obvious consequence. He emigrated to England in the autumn of 1933. On January 29, 1934, only two months after his 65th birthday, he died in Basel (Switzerland) on his way to visit the just being founded Daniels Sieff Research Institute in Rehovot (Palestine) which was later to become the Weizmann Institute.

After Haber's resignation Otto Hahn took over as director of the institute following Haber's request as well as a recommendation by Max Planck, the president of the KWG. However, in October 1933 the Prussian government appointed Gerhart Jander, formerly professor of inorganic chemistry at Göttingen, as temporary director. This was against the agreement with Haber and against the recommendation of the Kaiser-Wilhelm Society. The legally unjustified temporary solution was accepted by the Society only in the "firm expectation that the final choice of director would be made with the agreement of the Kaiser-Wilhelm Society".

Jander notified all scientists in question who had not yet voluntarily resigned and the existing lines of research at the institute were abruptly terminated. While the 1933 yearbook of the institute still included 68 papers by 45 authors published in 1932, the year 1934 produced only 8 papers by 6 authors, all in the field of inorganic chemical analysis. Amongst the authors no name could be found from the time before 1933.

Since the appointment of Jander by the Prussian Ministry for Science, Art, and Education and the Ministry for the Armed Forces was only temporary, Max Planck submitted nominations of other scientists as Haber's successors to the Ministry, naming Karl Friedrich Bonhoeffer, Arnold Eucken or Max Volmer as suitable candidates. This had, however, no consequences. Eventually, it became clear to the Ministry for the Armed Services, who took great interest in the institute, that Jander was no longer a suitable director for the projects assigned to the institute. Therefore, the minister agreed to the appointment of Peter Adolf Thiessen as director. Thiessen had already been installed by Jander as a Department Head at the institute and enjoyed the full trust of the political authorities.

The Senate of the Kaiser-Wilhelm Society had no choice other than to agree to this appointment. Thiessen set up additional departments and gradually reinstated scientific work covering a broad spectrum of chemistry. Projects of technical and commercial significance acceptable to the authorities had always preference but he allowed the members of the institute considerable freedom to carry out basic research. P. A. Thiessen himself headed a Department of Colloid Chemistry. A new Department of Physical Chemistry was started by Ernst Jenckel where properties of glasses and polymers were investigated. In addition, there was a Department of Inorganic Chemistry led by August Winkel, a Department of Organic Chemistry under Arthur Lüttringhaus, a Department of Fine structure Research under Otto Kratzer and later a project team for macromolecule chemistry under Kurt Ueberreiter. Bernhard Baule and Kurt Molière were working at the institute as mathematician and theoretical physicist, respectively.

After the outbreak of the Second World War (in September 1939)  the institute was, for the second time, almost entirely directed to projects of military interest. Only few basic science investigations could by carried on. Here theoretical studies on Ray interference and electron diffraction by Kurt Molière deserve special mention, as do the investigations by Otto Kratky who developed X-ray small angle scattering. In 1944 Iwan N. Stranski, having worked as Professor of Physical Chemistry in Sofia until 1941 and later at the Technical University in Breslau, was appointed Scientific Fellow of the institute and performed pioneering studies on crystal growth and phase formation.

Towards the end of the war some of the experimental and workshop equipment as well as the contents of the library had to be evacuated. The latter provided the basis for the Otto-Hahn Library in Göttingen, which is now located in the Max-Planck Institute for Biophysical Chemistry. The buildings of the institute, however, escaped extensive damage. Only the striking pointed roof of the main building fell victim to the bombing. After the occupation of Berlin by the Soviet army the equipment remaining in the institute was confiscated and transferred to the Soviet Union. This occurred before the American army had set up its Berlin sector in which the institute was located. Of all scientists only Iwan N. Stranski, Kurt Molière, and Kurt Ueberreiter remained in Berlin. Their courageous protection of the institute during this chaotic time deserves much praise. P. A. Thiessen went to the Soviet Union. He returned to the German Democratic Republic (Deutsche Demokratische Republik, DDR) in the mid 50's as a Fellow of the Academy of Sciences and became President of the DDR Research Council.