German Chancellor Angela Merkel has warned Turkey's president that comparing German officials to Nazis must stop, "no ifs, no buts".
Mrs Merkel said if Recep Tayyip Erdogan continues, more campaign events by Turkish politicians may be banned.
German authorities have cancelled rallies designed to woo ethnic Turkish voters ahead of a key referendum on expanding Mr Erdogan's powers.
"You are right now employing Nazi measures," Mr Erdogan said on Sunday.
"When we call them Nazis they (Europe) get uncomfortable. They rally together in solidarity. Especially Merkel," he said in a televised speech.
Mr Erdogan appeared to be addressing Mrs Merkel personally when he suggested that Germany was "employing Nazi measures", using the informal "you" in Turkish.
"My remark that the Nazi comparisons from Turkey must stop still applies. No ifs, no buts," Mrs Merkel said at a news conference in Hannover on Monday with visiting Japanese Prime Minister Shinzo Abe.
Responding to Mr Erdogan's comments, she said that Germany reserved the right to "take all necessary measures", including reviewing future events that had already been granted permission.
Mrs Merkel said that such comments were "breaking every taboo, without consideration for the suffering of those who were persecuted and murdered" by the Nazis.
She added that appearances by Turkish politicians in Germany "can only take place on the basis of the principles of German constitutional law".
As the war of words intensified on Monday, Turkey's Deputy Prime Minister, Numan Kurtulmus, said that Germany was meddling in Ankara's internal affairs, adding that it was "unacceptable" for German newspapers to carry so many headlines about Turkey.
It comes amid a widening, increasingly acrimonious dispute between Turkey and a number of EU governments and institutions.
German Foreign Minister Sigmar Gabriel told Passauer Neue Presse on Sunday that his country was tolerant but not stupid, and that he had let his Turkish counterpart know very clearly that a line had been crossed.
Mr Erdogan has accused Mrs Merkel of using "Nazi measures" after local and state authorities in Germany refused to allow several Turkish ministers to campaign ahead of the Turkish referendum.
About 1.4m Turks in Germany can vote in the referendum on 16 April.
Voters will be asked whether they back a new constitution, which would transform the country from a parliamentary republic into a presidential one.
That would give Mr Erdogan, as president, new powers over the budget and the appointment of ministers and judges, as well as the power to dismiss parliament.
However, German officials have withdrawn permission for rallies in Gaggenau, Cologne and Frechen.
Mr Erdogan has come under intense international criticism amid a far-reaching crackdown on his opponents since a failed military coup last year. Dozens of Turkish journalists and writers have been arrested, and a large number of diplomats and soldiers have sought asylum elsewhere.
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