After visiting Berlin in mid July I have a few days to spend in northern Germany. I'd like stay somewhat close to Berlin as I will be leaving from there back to Munich to catch my flight back to the States(no more than 5 hours by train, no car). Small towns would be great. TI thought about visiting Peenemunde. Any other fun places to visit?
If you intend to do a day trip or two from Berlin, then definitely Potsdam, first take the tour and then go back by bus and foot, especially to see Neues Palais. Other cities I recommend are Rostock, since you might go to Peenemünde anyway, Schwerin (but that's better from Hamburg than Berlin), Leipzig...that train station will amaze you and the city's cultural history. In 2009 I was going to do a day trip to Magdeburg from Berlin but changed my mind almost at the last minute, spent two whole days there, well worth it, especially the Zentrum. Dresden is a little over 2 hrs from Berlin, which should be taken in slowly, not rushed as a day trip. If you're interested in Prussian history and science, take the train from Berlin to Jena, which I've still not done. Dresden and Magdeburg are on the Elbe, walk across the bridge(s).
We wandered in the Jena area by car on our last trip- like the Romantic Road was 40 years ago. Very rural and sublime
Hamburg, Hamburg, Hamburg! As of a few weeks ago, that's my favorite city in Germany. I haven't been there yet, but I've heard great things about Kiel as well.
I too highly recommend Potsdam and the palace. We've taken day trips to the south from Berlin on several occasions. We love Dresden, Leipzig, Goslar, and Wittenberg for their beauty and history. A very long time ago, as we were driving through the newly opened East, we spotted a city at dusk that we really want to return to. It is Quedinburg and I understand that it has been put on the UNESCO list recently. It looked utterly medieval and untouched. Enjoy your exploring.
Potsdam and Dresden seem like naturals. A little further out might add Rostock, Lubeck or Hamburg. I really liked both Kiel and Schlesswig but that's getting further away from Berlin.
Braunschweig and Hildesheim are nice towns.