Double world champion Lopez went fastest on his first lap of the session, immediately going five seconds faster than the rest of the field with a best time of 8m44.236s around the 14-mile Nordschleife circuit.
The Argentinian looked set to improve on that benchmark before backing out of his lap in a yellow-flag zone, but remained a second clear of the pack.
Muller was fastest in Thursday morning's test session but could not respond to his team-mate's time in the hour-long first practice.
But the Frenchman was able to jump up to second with his first real attempt, an 8m45.319s lap, shortly before the session was brought to a premature end when Honda's Rob Huff crashed.
Huff had been on course to improve his time, which left him fifth overall, but suffered a right-front suspension failure and smacked the Armco barrier on his right-hand side, bouncing back across the track before coming to a stop.
The Briton was unhurt in the crash and walked away from his Honda Civic, but with a little over a minute remaining and with Huff's damaged car strewn on the edge of the circuit, the session was red-flagged.
As a result, Tom Chilton ended the session a fine third, completing a Citroen 1-2-3 in his satellite C-Elysee.
The Sebastien Loeb Racing driver lost less time than his rivals through a yellow-flag zone but appeared to slow sufficiently on his lap, ending the session 1.389s down on Lopez's time and comfortably faster than team-mates Mehdi Bennani (ninth) and Gregoire Demoustier (17th).
Nicky Catsburg was the best of Lada's contingent and a competitive fourth, just ahead of Huff and Honda team-mate Norbert Michelisz.
Hungarian Michelisz suffered a throttle pedal problem on his first flying lap and stopped early on in the session, but the recovery of his car gave his mechanics ample time to repair his Civic, allowing him to return to the track with 10 minutes of the session remaining.
Gabriele Tarquini was seventh ahead of Tiago Monteiro, while behind Bennani Tom Coronel completed the top 10 in the first of the Chevrolet Cruze's.
Aside from Huff and Michelisz's problems, two other drivers hit significant trouble.
Midway through the session, Lada's Hugo Valente suffered a right-front puncture on his second flying lap at the Wippermann corner in the track's fourth sector, biffing the barrier to his right before being spat out into the middle of the track, breaking both his right wheels and bringing out the session's first slow zone.
Polestar's Fredrik Ekblom finished the session 13th fastest, although like Valente he was limited to just one lap after reporting an engine misfire.
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