The main opposition CHP won about 25 percent of the vote, or 134 seats, while the nationalist MHP party secured 11.9 percent with 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 victory, 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 Nov. 1 elections that they prefer action and development to controversy,” Erdogan said, adding voters “have given proof of their strong desire for the unity and integrity” of Turkey.
Prime Minister Ahmet Davutoglu had declared victory on Sunday as results reported by state-run TRT television showed that or AKP had won more than 49 percent of the vote and was projected to get 316 seats in parliament.
Following the vote, Davutoglu struck a conciliatory tone, asking ruling party supporters to remain solemn and to embrace fellow Turks.
“Today is the day of victory but it is also a day for humility,” Davutoglu said, addressing supporters in his hometown of Konya, where he voted.
He kept up the placatory manner during a victory address to thousands of AKP supporters gathered outside party headquarters in Ankara, promising to end the party's often divisive rhetoric and asking for the "blessing" of anyone offended by the harsh election campaign.
Speaking from the balcony of AKP headquarters, Davutoglu also pledged to uphold freedoms and called for opposition parties' support for constitutional amendments to make Turkey's laws more democratic. It was not clear if the party had abandoned contentious plans to change Turkey's political system to one that would give the president more powers.
Davutoglu spoke vaguely about pressing ahead with a peace process with the Kurds, but said Turkey was determined to continue to fight Kurdish rebels, who are considered terrorists.
“We won't step back from our determination for a solution or from our determination to fight terrorism,” Davutoglu said.
The results suggest that the AKP, Erdogan's party, succeeded in its gamble to hold new elections.
“The election results show that our nation has sided with looking after the environment of stability and trust that was risked on June 7,” he said in a statement.
The vote was a rerun of a June election in which AKP surprisingly was stripped of its parliamentary majority for the first time in 13 years due to a strong showing by a Kurdish party.
Millions of Turks turned out to vote Sunday in what was seen one of the most crucial elections in years, with the country deeply divided in the face of surging Kurdish and religious violence and mounting concerns about democracy and the economy.
About 385,000 police and gendarmes were mobilized nationwide, with security particularly high in the restive Kurdish-majority southeast, where armored vehicles and police were seen outside polling stations.
The co-leader of the pro-Kurdish opposition Peoples' Democratic Party (HDP) said the election outcome was the result of a deliberate policy of polarization by Erdogan. Figen Yuksekdag told a news conference in Ankara that the HDP would analyze a drop in its support since the June election, but said the fact that the party had crossed the 10 percent threshold needed to enter parliament was nonetheless a success.
Earlier, clashes erupted outside the HDP headquarters in the main Kurdish city of Diyarbakir in southeastern Turkey.
Turkish police fired tear gas and a water cannon at Kurds who protesting after it appeared that the AKP would win a clear victory, an Agence France-Presse photographer said.
The political landscape has changed dramatically in Turkey since June, with the country even more polarized on ethnic and sectarian lines.
Turks are fearful of a return to all-out war with outlawed Kurdistan Workers' Party (PKK) rebels after fresh violence shattered a 2013 truce in July, just a month after a pro-Kurdish party won seats in parliament for the first time, denying the AKP a majority.
The threat of fresh violence also overshadowed Sunday's poll after a string of attacks blamed on the Islamic State in Iraq and the Levant (ISIL), including twin suicide bombings at an Ankara peace rally last month that killed 102 people — the worst in Turkey's modern history.
“All I want is peace and brotherhood, we have suffered too much lately,” 43-year-old voter Mahmut Kiziltoprak told Agence France-Presse in the main Kurdish city of Diyarbakir.
The June result had wrecked Erdogan’s ambition to expand his role into a powerful U.S.-style executive presidency that opponents fear would mean fewer checks and balances in what was once regarded as a model Muslim democracy.
A string of high-profile raids against media groups deemed hostile to Erdogan and the jailing of journalist critics have set off alarms about the state of democracy in a country that has long aspired to join the European Union.
“The AKP has turned this country into a wasteland,” said 55-year-old engineer Selim Ciftci as he voted in an Ankara district. “It's enough!”
Increasingly isolated on the world stage, Turkey is also struggling with its policy on neighboring Syria and the burden of more than 2 million people who have taken refuge from Syria’s bloody war that is well into its fifth year.
Further political turmoil could also add to jitters about Turkey's economy, with growth slowing sharply from the dizzying heights of five years ago and the Turkish lira plunging more than 25 percent this year.
The Peoples' Democratic Party (HDP) made history in June when it became the first pro-Kurdish movement in parliament. But the party has faced accusations of being a front for the PKK, whose armed campaign for autonomy has killed 45,000 people since 1984.