German Chancellor Angela Merkel has described the murders of nine immigrants and a policewoman by a suspected neo-Nazi cell as "shameful".
Officials believe members of the same group also carried out bank robberies and a bomb attack in Cologne over a period of more than 10 years.
The group only came to light this week when one alleged member surrendered and two others killed themselves.
The case has stunned Germany, which is still sensitive to its Nazi past.
The BBC's Chris Morris, in Berlin, says the case has made headlines across Germany, knocking the eurozone crisis off the front pages.
As shocking as the murders are, he adds, there are broader political questions that demand answers.
Allegations in the German media suggest that one or more of the group may have worked as informants for the domestic intelligence services.
Interior Minister Hans-Peter Friedrich told the daily Bild newspaper there was no evidence to suggest that any of the three had been informants.
Spotlight on police Police believe eight ethnic Turks, an ethnic Greek and a policewoman were murdered by members of the hitherto unknown "National Socialist Underground".
"It is shameful that something like this happened in our country," Chancellor Merkel said.
"We will investigate it thoroughly. We owe that to the people who lost their lives."
German media and politicians threw the spotlight on security services for the eastern state of Thuringia, where the suspects were based.
"It is deeply troubling that there was no connection made between the murder series across Germany and the far-right scene in Thuringia," Mr Friedrich told the Bild.
"Without question, this is a new dimension of right-wing extremist violence."
He said investigators were trying to discover whether a larger militant network was at work.
The suspect who surrendered to police was named only as Beate Z.
She had been sought over an armed robbery in the eastern city of Eisenach and handed herself in on Tuesday after allegedly blowing up the flat she had rented in the eastern town of Zwickau.
The remains of two men close to her, also wanted over the armed robbery, were found shortly afterwards in a burning caravan in Zwickau.
A pistol recovered from the caravan was found to be the service weapon of a German policewoman shot dead in 2007 in the south-western city of Heilbronn. A second weapon is also believed to have been recovered.
Investigators said they also found neo-Nazi propaganda DVDs. Officials said that scenes in the video led them to re-open an investigation into a 2001 bombing in the western city of Cologne in which a German-Iranian woman was seriously injured.
After the caravan was searched, police also arrested a man suspected of being a member of the National Socialist Underground near the northern city of Hannover.
Officers said the man, identified as Holger G, was suspected of providing his driving licence and passport to the other three alleged members of the group.
He was brought before a judge on Monday and ordered detained.
The victims were all small businessmen of immigrant background - mainly kebab stall owners - who were shot in the face in broad daylight.
The far right in Germany is small and politically marginalised but over the years has carried out periodic attacks on immigrants.
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