US President George W Bush is hosting German Chancellor Angela Merkel at his Texas ranch, with Iran's nuclear programme likely to dominate the talks.
Angela Merkel has a good working relationship with Mr Bush
Her two-day trip follows French President Nicolas Sarkozy's US visit.
White House officials said the two leaders would discuss "ways to work together on the diplomatic track to get Iran to halt its uranium enrichment".
Mrs Merkel has said Germany supports a diplomatic solution but would back tougher UN sanctions if necessary.
Mr Bush met Ms Merkel and her husband when they arrived and drove them off on a short pre-dinner tour of the ranch.
"In Texas, when you invite somebody to your home, it's an expression of warmth and respect and that's how I feel about Chancellor Merkel," Mr Bush said as they met.
"Already a first glance of the area shows that this is indeed a wonderful place," Ms Merkel responded.
US and German officials have said they do not expect any major announcements following the talks.
Mrs Merkel and Mr Bush are also expected to discuss Afghanistan, the Middle East, Iraq, climate change, Burma, and the Doha trade talks.
Since taking office in 2005, Mrs Merkel has become one of President Bush's closest European colleagues.
Correspondents say her visit and that of Mr Sarkozy form part a week-long charm offensive by Mr Bush to woo the two influential European leaders.
In a news conference following Wednesday's talks with Mr Sarkozy, President Bush said the pair had agreed to "work jointly to convince the Iranian regime to give up their nuclear ambitions for the sake of peace".
But the French leader emphasised that Iran was entitled to develop civilian nuclear energy, which Tehran argues is the sole aim of its programme.