With almost all of the ballots counted early on Monday, Erdogan's party won 49.4 percent of the vote - enough for a majority of 316 seats.
The main opposition CHP won about 25 percent of the vote (134 seats), while the nationalist MHP party secured 11.9 percent (41 seats).
The pro-Kurdish HDP party has claimed a little over 10.5 percent to get 59 seats.
In a statement after his party's win, Erdogan said the result "delivered an important message" to the outlawed Kurdistan Workers' Party that "oppression and bloodshed cannot coexist with democracy.
"Our people clearly showed in the November 1 elections that they prefer action and development to controversy," 61-year-old Erdogan said.
Voters "have given proof of their strong desire for the unity and integrity" of Turkey, he added.
The outcome of the vote came as a surprise to many, as opinion polls had predicted a replay of the June election when the AK party won only 40 percent and lost its majority for the first time in 13 years.
Addressing jubilant AK party supporters in his hometown Konya as the results became clear, prime minister and AK party leader, Ahmet Davutoglu, said that all 78 million people of Turkey would be embraced, whether they voted for the party or not.
"We are here to plant seeds of love. There is no rival or enemy on this land. There is only affection," he said.
"Nobody should get into a psychology of defeat. Our democracy has won," Davutoglu added.
The polls were held amid instability spilling over to Turkey from neighbouring Syria and renewed tensions over the 30-year-old Kurdish conflict.
Three bomb attacks in recent months on political and activist rallies across Turkey, blamed on the Islamic State of Iraq and the Levant (ISIL), shocked the Turkish public, killing 139 people.
A bomb explosion in October at a peace rally in the capital, Ankara, killed 102 people. The violence marked the worst such attack in the country's modern history.
Source: Bloom Gist and Agencies
