Tensions flared after German authorities refused to allow some Turkish ministers to campaign for a 'yes' vote in the April 16 referendum on expanding Erdogan's powers, and he responded by saying Berlin was behaving like Nazi Germany.
"When we call them Nazis they (Europe) get uncomfortable. They rally together in solidarity. Especially Merkel," Erdogan said in a televised speech.
"But you are right now employing Nazi measures," Erdogan told Merkel using the informal 'you' in Turkish.
"Against who? My Turkish brother citizens in Germany and brother ministers" who went to the country to hold campaign rallies for a 'yes' vote in next month's referendum.
Authorities in Germany have blocked some Turkish ministers from holding rallies, infuriating Ankara.
Erdogan said the crisis in relations with Europe over the last days "showed that a new page had been opened in the ongoing fight against our country."
Turkey had earlier expressed fury that German authorities had on Saturday allowed a pro-Kurdish demonstration in Frankfurt to go ahead where many participants carried insignia of the outlawed Kurdistan Workers Party (PKK).
Germany meanwhile is livid over the jailing ahead of a trial on terror charges of dual Turkish-German national Deniz Yucel, the Turkey correspondent of the German newspaper Die Welt.
Erdogan described Yucel, whose arrest has caused global concern, as a "terror agent" and "supposed journalist" and accused Germany of hosting him for one month at its Istanbul consulate before he went to police for questioning.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)