This can be found as "Beim Bäcker hat's gebrannt" (The Baker's Place Burnt Down).

Notes

Alternate Lines:

(1) Elisabeth war nackt nackt nackt (Elizabeth was naked, naked, naked)
da haben wir gelacht lacht lacht (Then we laughed, laughed, laughed)

Elisabeth die schämte sich (Elizabeth was ashamed)
und zog die Decke über sich. (and pulled the blanket over herself)
Die Decke hat ein Loch, Loch, Loch (The blanket had a hole, hole, hole)
da sah ich sie ja doch, doch doch. (I saw her still, still, still)

Elisabeth die schämte sich, (Elizabeth was ashamed)
das ist das Ende der Geschicht' (That's the end of the story)

Elisabeth die war so Fett (Elizabeth was so fat)
Da krachte gleich das ganze Bett! (The whole bed just collapsed!)

(2) Gleich in den ersten Stock (Right on the first floor)
Da stand ein Mann im Unterrock. (There stood a man in his petticoat.)

Another Version:

Bei Müllers hatt's gebrannt,
Da bin ich hingerannt.
Do war a kleener Zaun,
Do wollt ich Äppel klaun
Do kam der Herr Schandarm*
Und nahm mich untern Arm,
Der führt mich um die Eck
Und plötzlich war ich weg

English Translation:

The miller's house burned down,
Then I ran away.
There was a little fence,
Then I wanted to steal apples
There came a Policeman
And took me under his arm,
He led me around the corner
And suddenly I was gone.

*Schandarm, German rendition of the French "gendarme", from Middle Ages "gens d'armes" (people-at-arms). The "gendarmes" belong to a branch of the armed forces responsible for internal security in parts of the territory (primarily in rural areas and small towns in the case of France) with additional duties as a military policeman for the armed forces. -Wikipedia

Watch
Here are the lyrics for the video below:

Bei Müllers hat's gebrannt, brannt, brannt,
da bin ich hingerannt, rannt, rannt,
da kam ein Polizist, zist, zist,
der schrieb mich auf die List, List, List,
die List fiel in den Dreck, Dreck, Dreck,
da war mein Name weg, weg, weg,
da lief ich schnell nach Haus, Haus, Haus,
und die Geschicht' war aus, aus, aus.

English Translation

The miller's house burnt down, down, down,
Then I quickly ran away, way, way,
There came a policeman, man, man,
He wrote me on his list, list, list,
The list flew in the dirt, dirt, dirt,
My name was gone,
I quickly ran to my house
And the story was over, over, over.

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Thanks and Acknowledgements

Translated by Monique and Lisa.