Background:

When Berlin was first divided up into four zones there was support for communism in the East Germany under the control of the Soviets
Complaints from people were made about the Stasi (secret police) and corruption in the government
East Germany had a low standard of living in comparison to West Germany
In the 1950s, many East Germans travelled to West Berlin to access West Germany and never returned upon arriving
The many Germans leaving Berlin boosted US propaganda

Changing environment:

January 1961 - new president of the US, John F. Kennedy, was elected
Kennedy backed a failed attempt to overthrow the communist president in Cuba, Fidel Castro, in April 1961
Khrushchev used Kennedy's failure as an opportunity to request US troops removal from Berlin
Vienna, 1961 - Khrushchev and Kennedy meet
Kennedy refused Khrushchev's demands again and ordered 150,000 US reservist troops to be called for action in Germany
Khrushchev claimed Kennedy was promoting conflict, using Berlin as a base for spies
Within this tension, on the night of the 13 August, East German soldiers erected a barbed-wire fence along the border of East and West Berlin
All crossing points were sealed up apart from Checkpoint Charlie
The main reason for the wall was to stem the flow of people out of East Germany

What happened next?

West Berliners feared Soviet invasion and US withdrawal
17 August 1961 - West Berlin staged a demonstration; Kennedy sent more troops
Soviets and East Germans continued to strengthen the wall
27 October - US and Soviet tanks faced off at Checkpoint Charlie, withdrawing the next day

Impact of the crisis:

Khrushchev ordered East German leader, Walter Ulbricht, to avoid any further tensions
The wall remained in place and became a symbol of division
Kennedy stood up to Khrushchev and made good propaganda of the situation