The VIIA had limited fuel capacity, so 24 Type VIIB boats were built between 1936 and 1940 with an additional 33 tons of fuel in external saddle tanks which added another 2500 miles (4625 km) of range at 10 knots (19 km/h) surfaced. They were slightly faster than the VIIA, and had two rudders for greater agility. The torpedo armament was improved by moving the aft tube to the inside of the boat. Now an additional aft torpedo could be carried below the deck plating of the aft torpedo room (which also served as the electric motor room) and two watertight compartments under the upper deck could hold two additional torpedoes giving it a total of 14 torpedoes. The only exception was U-83, which lacked a stern tube and carried only 12 torpedoes.

Type VIIBs included many of the most famous U-boats of world War II, including U-48 (the most successful), Prien's U-47, Kretschmer's U-99, and Schepke`s U-100.

On the surface the boat was powered by two supercharged MAN, 6 cylinder, 4-stroke M6V 40/46 diesels (except for U-45 to U-50, U-83, U-85, U-87, U-99, U-100, and U-102 which were powered by two supercharged Germaniawerft 6-cylinder, 4-stroke F46 diesels) giving a total of 2,800 to 3,200 bhp (2,400 kW) at 470 to 490 rpm. When submerged, the boat was powered by two AEG GU 460/8-276 (except in U-45, U-46, U-49, U-51, U-52, U-54, U-73 to U-76, U-99 and U-100 which retained the BBC motor of the VIIA) electric motors giving a total of 750 shp (560 kW) at 295 rpm.