Polls show Erdogan falling short of a first-round victory in the presidential race but he would be expected to win a run-off on July 8, while his AK Party could lose its parliamentary majority, possibly heralding increased tensions between president and parliament.
Speaking early Monday, Supreme Election Council head Sadi Guven said 97.7 percent of votes had been counted and declared Erdogan the victor, according to the Associated Press.
His closest challenger Muharrem Ince of the main opposition, secularist Republican People's Party (CHP), received almost 30 percent of the votes.
İnce's concession speech in Ankara came after Turkey's supreme election board confirmed the election results, with Erdoğan winning re-election with an outright majority in the first round, on 52.6% of the vote with 99% of ballots counted.
More than 56 million people were registered to vote at 180,000 ballot boxes across Turkey.
"According to unofficial results, the outcome of the elections is clear".
According to Israeli newspaper Haaretz, Erdogan and his AKP party "used state resources to ensure victory" adding that "the media is nearly totally pro-Erdogan after years of co-option and censorship". But Erdogan was not the only person to claim a victory.
The pro-Kurdish Peoples' Democratic Party, or HDP, was edging past the 10 per cent threshold to enter parliament, with 10.7 per cent.
There were another four candidates on the presidential ballot, all of whom fell below 10% of the vote.
Mr Ince, who won 30.6% of the presidential vote, warned that Turkey was heading down a path towards autocracy.
Having defeated the twin threats of a reinvigorated opposition and a weakened currency, Erdogan addressed cheering supporters in the capital, Ankara, saying the victor of the election was democracy, the national will and the nation itself.
The post of the prime minister will be abolished, and its powers transferred to Erdogan, who will also have the ability to appoint senior judges, ministers and vice presidents, giving him full control of those who are supposed to check his authority.
Erdogan supporters celebrate outside his official residence in Istanbul on Sunday.
Meanwhile, the People's Alliance between the ruling Justice and Development Party (AK Party) and the Nationalist Movement Party (MHP) won the parliamentary election with 53.7 percent as the Nation Alliance - the CHP, the Good Party (IP) and the Felicity Party (SP) - managed to secure only 34 percent. Turkey's president will now hold extensive executive powers, and parliament will be much less significant.
"We want democracy", he said. They will continue to "liberate Syrian lands", he said, so that the 3.5 million refugees now living in the country can one day go home.
The Organization for Security and Cooperation in Europe (OSCE) said Erdogan had benefited from excessive media coverage and raised questions about the transparency of the vote.
A crackdown launched after a failed 2016 coup has seen 160,000 people including teachers, journalists and judges detained. There are several problems to face: the decline of the Turkish lira, a massive 12 per cent rate of inflation and the perception that Erdogan is curtailing the central bank's independence. More than 110,000 government workers have also been dismissed under a state of emergency after the coup.
Buoyed by opinion polls, opponents of Turkish President Recep Tayyip Erdoğan believed they had a realistic chance of unseating him-or at least reducing his dominance in Sunday's elections.
He further said that the historic and unparalleled bilateral relations between Pakistan and Turkey would continue to grow from strength to strength.