The 9th and 10th S.S. Panzer Divisions had been sent north of the River Rhine to rest and refit, and to this end the 9th had been ordered to hand over all of their vehicles and equipment to their sister Division, prior to returning to Germany, where they themselves would be fully re-equipped. The commander of the 9th S.S. Panzer Division, Obersturmbahnführer Harzer, chose to follow these orders as loosely as possible, because he was well aware that if a sudden offensive were to be launched by the Allies then he might find himself in desperate need of these vehicles. As a result, when the landings took place, much of the 9th Division's tanks were temporarily out of service, typically having had their tracks removed.
Needless to say, an hour-long landing of airborne troops, involving three hundred gliders and two thousand parachutists dropping out of the sky, was certain to attract the attention of someone. The landings were observed by German soldiers and generals all over the Market Garden area, suitably impressing and troubling them at the same time, yet few appreciated the size of the landings, and none suspected that this was only the first of three air lifts. The objectives of the landings were not immediately apparent to senior commanders, indeed Feldmarschall Model initially believed the only possible purpose for the presence of Airborne troops at Arnhem was to capture him at his Oosterbeek HQ. He left the Tafelberg Hotel immediately and drove eastwards, establishing his Headquarters at Doetinchem, twenty-five miles to the east of Arnhem. Despite this initial confusion, a picture of what was taking place soon became clear, and thereafter the German units throughout the Market Garden area reacted with astonishing speed and considerably hardened their defences.
One unit in particular reacted very sharply to the landings. Two companies of S.S. Panzergrenadier Bataillon 16, also known as Battalion Krafft, named after their commander, Sturmbannführer Krafft, had spent the morning in woods to the east of Wolfheze, on the edge of LZ-Z. Krafft knew immediately that their objective must be Arnhem Bridge and, realising that his men were closest to the area, he set out without delay to oppose the threat, gathering every man that he could en route. Although his total numbers amounted to just four hundred and thirty-five (an under-strength battalion), he managed to establish a firm blocking line covering the obvious paths from the landing areas to Arnhem. Centred around the Hotel Wolfheze, a mile east of LZ-Z, his line extended from the railway line down to the Utrechtseweg; the routes down which the Reconnaissance Squadron and the 1st and 3rd Parachute Battalions were due to proceed. Krafft hoped to convince the advancing British that his force was much larger than it was and, in so doing, delay them long enough for more substantial German forces to be assembled behind him.
At 17:30, Obergruppenführer Bittrich, the commander of the II S.S. Panzer Korps, ordered the 9th S.S. Panzer Division, who had been making frenzied efforts to make their disassembled vehicles ready for use ever since the landings had been discovered, to occupy Arnhem, contain the 1st Airborne Division and then destroy them. The 10th S.S. Panzer Division, meanwhile, were instructed to proceed with all haste to Nijmegen Bridge to establish a small bridgehead south of the River Waal and deny a crossing to the enemy at all costs. The Division was, however, at a disadvantage in this regard, because they were largely based twenty miles to the north-east of Arnhem, and as the only way over the River Rhine was Arnhem Bridge, it was vital that they reach and cross it before any British troops could arrive to deny them passage.
Before midnight, Model had issued the outline orders that set in motion the plan to contain Market Garden. The 9th S.S. Panzer Division were to hold the British back from Arnhem, but other forces were ordered to assist them. Armed Forces Command Netherlands had been alerted and were bringing their regional defence and training units to bear in the form of Kampfgruppe von Tettau, consisting of an estimated three to four thousand men, who were to attack the 1st Airborne Division from the west. In addition, a variety of other infantry and armoured reserves were gradually drawn from other sources and committed to the battle.
Meanwhile, back on the drop zones, things began to go wrong for the British when the men of the 1st Airborne Divisional Signals discovered that their radios were not working correctly. The main radio sets used throughout the Division; the hand-held Type 68 and the Jeep-mounted Type 22 sets, were not designed to carry a signal over five miles. Divisional Signals were well aware of this and knew that the units at the Bridge and the drop zones, eight miles apart, would be out of contact with each other until the remainder of the Division began to advance towards Arnhem on the second day. However, due to a combination of the built-up areas and patches of dense woodland which dominated the surrounding landscape, the radio sets proved to be extremely ineffective even over remarkably short distances. Only the longer-ranged Type 19 sets, carried by the gunners of the 1st Airlanding Light Regiment, were performing satisfactorily, though this fact was little known at the time, and in any case it would not have aided inter-battalion and brigade communications.
Furthermore, it became apparent that the Very High Frequency sets, carried by the 306th Fighter Control Squadron, the only American unit present at Arnhem, were not working either. This ten-man team had been attached to the Division to communicate with the masses of Allied fighter aircraft that were on hand to attack targets on the ground, but the Squadron's VHF sets had been tuned to a different frequency and so it was impossible to contact them. The aircraft circling overhead were under strict orders not to attack targets unless first invited to do so by observers on the ground, and so, in addition to losing communications at almost all levels within the Division, this blunder had also robbed them of air support.
The 1st Airborne Division was also unable to make contact with anyone outside of the Arnhem area, and therefore the units arriving on subsequent airlifts could not be warned of the threat of stiffening resistance, nor could their drop zones be relocated. None of this was of very serious significance, however, providing that everything ran smoothly and according to plan, but if it did not then the scene would rapidly degenerate into confusion and chaos.