Malmédy (mälmādēˈ) [key], commune (1991 pop. 10,291), Liège prov., E Belgium, near the German border. Economic mainstays are tourism and the manufacture of beer, paper, and tanning fluid. The town and the surrounding district belonged to the abbey of nearby Stavelot until they passed (1815) to Prussia. Malmédy and Eupen were transferred to Belgium by the Treaty of Versailles after World War I. In World War II heavy fighting occurred at Malmédy during the Battle of the Bulge (Dec., 1944) and 72 U.S. prisoners of war were massacred by German troops.