'If you're faced by the wall every morning, it's dark all day," says Steve Morell, DJ, musician and one of Berlin's legendary night-owls. "Even though we were just in the West, it felt apocalyptic; I thought it would never end."

It's a blue-sky morning outside the Rauchhaus, one of the oldest squats in Berlin, right up by the former death strip. I've come to see how the city has changed in the 20 years since the wall fell, with the help of Steve and my old friend Nackt, from cult Berlin band Warren Suicide. The idea is a personal road trip across the spaces that have transformed their cultural landscape.

Before 1989, Kreuzberg was the centre of alternative youth culture in West Berlin, and the Rauchhaus, a neo-Romanesque hospital, was on the eastern tip of this once-desolate neighbourhood, enclosed by the Landwehr canal and the wall. Named after left-wing radical Georg von Rauch, it now welcomes visitors, but check the website first. If you don't mind sharing with strangers, a bed in the "international guest room" costs from €3 a night. If that sounds a little scary, its Smoke House parties offer lashings of authentic Berlin spirit on the second weekend of each month (see the link on the opposite page).

"This area was incredible," says Steve (born Stephan Kraus), who arrived from Frankfurt in 1984, aged 17, to squat with 40 other left-wing activists. We are standing in bright sun by discarded doors, tyres and filing cabinets. Dilapidated 1940s trucks line the pavement.

"There were squats everywhere and some amazing bands, very influential in Germany, used to record at the Rauchhaus. But it was the best and the worst of times. There were constant police raids. I'd hear shootings through the night behind the wall and read in the paper the next day what had happened outside our door."

After the wall fell, a third of the buildings in the eastern half of the city were lying empty, and techno activists from areas such as Kreuzberg began to search for new spaces to party. In early 1990, the first improvised clubs opened, as basements became bars, and unused municipal buildings – from warehouses to power stations – formed a spider's web of a DIY scene. We jump into Steve's Opel Vectra to drive east along the former no man's land of Bethaniendamm. At Schilling Bridge, we reach Maria, a seminal music venue opened in 1992. Nackt and Steve agree that this former storage unit on the river Spree is "one of Berlin's top five".

"It's as famous for indie/rock bands as for techno," says Nackt, who left the small town of Burghausen for Berlin just after the wall came down. "Warren Suicide have played amazing shows here, and so have Peaches, CSS, Simian."

Friederichshain was one of the most heavily bombed parts of Berlin in the second world war, with more than half its buildings destroyed as the allies targeted its industrial areas. The area still feels bleak, dominated by Soviet-era housing blocks and a wide sea of railway tracks, as well as one of the longest surviving sections of wall, now the 1.3km Eastside Gallery, its 100 or so post-revolution images – including the famous kiss between Brezhnev and Honecker – repainted this year.

With its low rents (compared with West Berlin) the area is now being ploughed (or plagued) by corporate monsters – the 02, MTV Europe, Universal Music – as part of an ongoing construction project along the Spree, dubbed Mediaspree. The boys, along with Berlin's youth, are worried the clubs will close to make way for riverside apartments.

"Already Bar 25, an institution, has shut," says Nackt, "but it's been having closing parties for 10 years."

Talk turns to Ostalgie, a rising wave of nostalgia for the old East Germany, from the resurrection of brands of foods to the interactive GDR museum in Mitte, where you can try out a Trabant car, or pretend to be a Stasi officer. "Look," says Steve, wagging a finger from the wheel at a Soviet block, "the whole Ostalgie thing is so big tourists can even stay in a 'typical GDR apartment' with 50s furniture." We laugh.

"Anything goes in there." We are bumping along a sandy track – the city was built on sand – towards an imposing power station in Friederichshain, where wide-eyed kids drift outside in colourful T-shirts, and a row of yellow cabs wait for business. It's a hot Sunday afternoon, but punters will have been going since Saturday night; some clubs keep going until Monday evening.

"This is the Berghain," says Steve, "one of the most famous clubs in Berlin." The boys are hoping to show me its Panorama bar with Wolfgang Tillmans artwork. The thud of minimal techno bangs like a headache.

Can we take a photo inside, we ask nicely. "No," is the growled reply. "And no journalists." We turn to leave. "I've seen things in there I couldn't repeat," says Steve, with a devilish smile.

So it's off to somewhere more cultural. Haus Schwarzenberg is an old factory in Mitte that is now a bar, gallery and cinema; it's where Steve loves to DJ, and Nackt's fellow band member Cherie has shown her art. As we enter a dark alley lined with picnic benches, Steve explains that it's run by artist duo the Dead Chickens, who moved here in 1995 after being based in Kreuzberg in the 80s. We sip cappuccinos in the peeling courtyard, and Steve shows me the bar spooked with the artists' famous "monster" artworks.

"It's the last oasis of real alternative art in the city," he says, as we climb graffitied stairwells to explore the white spaces of the Neurotitan gallery upstairs, which specialises in comics and graphic art.

There are few cities whose mythology is so closely tied to its nightlife, and back down in the courtyard, conversation bounces round other seminal eastside clubs – Bang Bang ("GDR decor again"), Tresor ("in Berlin's main central-heating power station"), ZMF ("in the basement of the biggest furniture factory for the east, kind of rotten but in a nice way," says Steve) and Lovelite ("a typical warehouse, like so many clubs in Friederichshain, in the middle of nowhere," says Nackt.) Nightlife has long been commercialised even here, but the boys agree that an underground creativity still pervades – if you avoid the weekend "clubbing tourists". And the unification of East and West Germany at the first techno parties as the wall fell is celebrated in an annual festival, the Love Parade.

But there are more places to tick off today, so we speed off again towards Kaffee Burger, a classic East German boozer dating from the mid-30s, complete with 50s GDR lettering on the windows. A faded poster advertises its fortnightly Russian discos and, inside, the aged decor under bright lighting, it's easy to imagine secret meetings of political dissidents over wheat beer and schnapps in the mid-70s, as they plotted an escape to the West.

"It's been around forever," says Nackt, "but it's still a cool after-hours place."

The Volksbühne, in Mitte, was rebuilt in 1954 after devastation in the war, hence its Soviet appearance. "Its name means 'Free People's Theatre'," says Steve. "Before the wall came down, it would have shown plays by Bertolt Brecht." Now it has the reputation of being one of the most experimental theatres in Germany, "where art meets rock".

"Warren Suicide sold this place out with a full string ensemble," says Nackt, and Steve has thrown his renowned "Berlin Insane" parties here (though the next one, on 19 November, will take place at the SO36 club, of which more later).

"Look at that sign." Nackt climbs out of the car by a huge expanse of grass, laddered with wooden platforms, where tourists nibble sandwiches. He's pointing to the words Stadt Des Friedens. "City Of Peace," he says. "How ironic!"

This is the site of the Palast Der Republik, the parliament built in 1976 to rubber-stamp decisions made by the Politburo, and finally pulled down earlier this year. The boys have mixed feelings about its destruction; in Berlin, after all, it's impossible to hide the past.

"What should we do?" asks Nackt. "Knock everything down that reminds us? What about the Reichstag?"

We end our road trip back in West Berlin, in Kreuzberg, whose main thoroughfare, Oranienstrasse, has long been a focus for alternative subcultures. Steve points out where singer-songwriter Nick Cave lived in the 80s and, nearby, legendary club Trash ("a bit like the Electric Ballroom in London, but run by Hell's Angels"), which no longer exists.Current flavour of the month is the bar Luzia, with its anything-goes music policy. Housed in an old butcher's shop, it's spacious, dark and heaving with bespectacled folk smoking on shabby sofas. "It's a great place: they might do a double shot when you order a normal one," says Steve.

Further down the street is the oldest club in Berlin. The SO36, named after its postcode, and once frequented by Iggy Pop and David Bowie, has the feel of a community hall, albeit one drenched in pink and red lighting, but it has played host to everything from gay Turkish nights to bands such as the Dead Kennedys, Stiff Little Fingers and the Cramps. As we grab a beer inside, Steve tells a story about a night here in the 80s when riots between punks and police exploded on the street and he ended up being arrested – and freed – twice. Nowadays you're more likely to get punters queuing in police drag, but sadly the venue faces closure – not without protests – because of noise problems.

Before I leave, Nackt wants to show me Berlin's hottest new area. The feeling among some Berliners is that East Berlin has "peaked" – and anyway, after 20 years, the division between East and West is beginning to blur. Isn't it? Perhaps, say the boys, although people still talk of the Mauer im Kopf, or the "wall in the head", the feeling that a psychological barrier still exists.

We snake round the corner of Kreuzberg and Neukölln (in the former West), known colloquially as "Kreuzkölln", its main vein, Hobrechtstrasse, dark and unassuming. "The scene constantly shifts a bit further south or east," says Nackt. He points out bars Salon Petra, and Mama, with their cracked walls, wonky lamps and crowds, but outside Raumfahrer (which means spacetraveller) we stop. Tonight, alas, it's closed, but Nackt says: "This is probably the coolest bar in Berlin simply because no one's discovered it yet."

The next evening I return with my friend Tom. It's a spacious room, and we enjoy slugging back Pilsners on stools in its red-lit interior. But Nackt's right: it's a place so hip that it really is empty.

Essential guide to the Berlin scene

Party venues

Rauchhaus: +49 173 448 7182; rauchhaus1971.de

Maria: +49 30 2123 8190; clubmaria.de

Bang Bang: Neue Promenade 10; bangbangclub.net

Berghain: Am Wriezener Bahnhof; berghain.de

Haus Schwarzenberg: +49 30 3087 2573; haus-schwarzenberg.org

Dead Chickens: +49 30 3087 2573; deadchickens.de

ZMF: Brunnenstrasse 10; zurmoebelfabrik.de

Luzia: Oranienstrasse 34; luzia.tc

SO36: +49 30 6140 1306; so36.de

Kaffee Burger: Tonstrasse 58/60; kaffeeburger.de

Volksbühne: +49 30 240 655; volksbuehne-berlin.de

Raumfahrer: Hobrechtstrasse 54

Salon Petra: Hobrechtstrasse 47; +49 30 21 10 95 39

Mama: Hobrechtstrasse 61; +49 157 7194 4916

Getting there

Easyjet (easyjet.com) flies to Berlin from £31 return. Germanwings (germanwings.co.uk) flies to Berlin Schönefeld.

Stephen Emms stayed at IMA (+49 30 6162 8913), a former bathroom fixtures factory dating from 1893, which now has galleries, studios, a courtyard deli and bar, plus 20 rooms for rent, all with kitchens, from €55 a night for two people.

Contacts

Berlin Tourism: +49 30 25 00 25; visitberlin.de

Steve Morell: pale-music.com,

myspace.com/stevemorellsmusic

Warren Suicide: warrensuicide.com