Today, the site hosts a memorial and museum.
In early summer 1943, mass production of the A4 (later better known as V-2, V standing for Vergeltung or retribution) ballistic rocket started at the Heeresanstalt Peenemunde on the Baltic island of Usedom as well as at the Raxwerke in Wiener Neustadt, Austria and at the Zeppelin works in Friedrichshafen on Lake Constance.
On 18 August 1943, a bombing raid by the Royal Air Force on Peenemünde ("Operation Hydra") seriously damaged the facilities and ended construction of V-2s there. Other air raids had damaged the other two sites in June and August. As a result, the Nazi leadership accelerated plans to move military construction to areas less threatened by Allied bombers. On 22 August 1943, Adolf Hitler ordered SS leader Heinrich Himmler to use concentration camp workers in future A4/V-2 production. One of the sites selected was at the mountain known as Kohnstein, near Nordhausen in Thuringia. Since 1936, the Wirtschaftliche Forschungsgesellschaft (WIFO) (English: Economic Research Company) had been building a subterranean fuel depot for the Wehrmacht there. By late summer 1943, this was almost finished.
To oversee the creation and operation of the new construction facility, Albert Speer, Himmler and Karl Saur agreed on the foundation of Mittelwerk GmbH (the name referring to the works' location in Mitteldeutschland). Its board consisted of Hans Kammler, who was head of Amtsgruppe C at the SS-Wirtschafts-Verwaltungshauptamt (WVHA) and two of Speer's armaments managers, Karl Maria Hettlage and Gerhard Degenkolb, the former seconded from Commerzbank. To actually run the plant, Albin Sawatzki, who had earlier been in charge of producing the "Tiger I" tank at Henschel, was appointed. The initial contract for Mittelwerk was for 12,000 rockets, valued at 750 million Reichsmark for a standard price per unit, once production reached 5,000 units, of 50,000 Reichsmark per rocket.:622,768