Mittelstand commonly refers to a group of stable business enterprises in Germany, Austria and Switzerland that have proved successful in enduring economic change and turbulence. The term is difficult to translate and may cause confusion for non-Germans. It is usually defined as a statistical category of small and medium-sized enterprises (SMEs; German: kleine und mittlere Unternehmen or German: KMU) with annual revenues up to 50 million Euro and a maximum of 500 employees.

However, the term is not officially defined or self-explanatory, so the English expression “small and medium-sized enterprises” is not necessarily equivalent to the Mittelstand. In fact, even larger and often family-owned firms claim to be part of the Mittelstand, such as Robert Bosch, based on the Mittelstand's positive connotations. The term Mittelstand mainly applies to mid-sized firms as opposed to larger listed companies and, more importantly, Mittelstand companies are characterized by a common set of values and management practices. In Britain different terms have been devised by the media to describe their own mittelstand companies, such as Brittelstand.

Ludwig Erhard, the Economics Minister who crafted post-war West Germany's economic miracle (German: Wirtschaftswunder) warned against reducing the Mittelstand to a mere quantitative definition, but instead emphasized more qualitative characteristics which embody the German Mittelstand, as it is "much more of an ethos and a fundamental disposition of how one acts and behaves in society."