The technology was approved by the German Federal Motor Transport Authority (KBA) and means Mercedes cars will be the first in the world to be equipped with an "internationally valid" conditionally automated driving system.
The system, called Drive Pilot, is capable of taking over driving at speeds of up to 37mph by controlling speed, distance from the vehicle and front and positioning within a lane.
The system will be available only in Germany at launch and is restricted to the country’s 8196 miles of autobahn.
Mercedes says it will allow drivers to take their hands off the wheel and perform "ancillary tasks" on their vehicle’s central infotainment display, such as sorting emails and online shopping.
The system uses lidar sensors, cameras, microphones and a wetness sensor, while road geometry and traffic events constantly read from a 3D digital map.
The technology automatically reads road signs and responds to unexpected incidents independently, performing evasive and braking manoeuvres. It can also detect the blue lights of emergency vehicles.
It will perform an emergency procedure if the driver doesn't take back control following urgent prompting.
Markus Schäfer, Mercedes’ chief technology officer, said: "With this lidar-based system, we've developed an innovative technology for our vehicles that offers customers a unique, luxurious driving experience and gives them what matters most: time.
"With the approval of the authorities, we've now achieved a breakthrough: we're the first manufacturer to put conditionally automated driving into series production in Germany.
"We're once again proving our pioneering work in automated driving and also initiating a radical paradigm shift. For the first time in 136 years of automotive history, the vehicle takes over the dynamic driving task under certain conditions.
"At the same time, we're pleased that Germany is continuing its pioneering role in automated driving with this approval."