Turkey's Justice Minister Bekir Bozdag earlier scrapped a visit to Germany after the authorities blocked a rally promoting a referendum that could expand Erdogan's powers.
"Our discomfort and our reaction to these developments have been communicated in person to the German ambassador who was summoned this evening to the (foreign) ministry," a senior Turkish official said on condition of anonymity.
The new row adds to tensions between Turkey and Germany over a number of disputes including Ankara's provisional detention of a German journalist on terrorism-related charges.
"That meeting with (the German justice minister) will not take place. I will return to Turkey," Bozdag said while on an official visit to Strasbourg, in remarks carried by private television station NTV.
Gaggenau authorities withdrew an earlier agreement with the Union of European Turkish Democrats (UETD) to hold a rally, with Bozdag as the guest speaker, saying that the hall did not have the capacity to host so many people.
"Because the event is now known across the region, the city expects a large number of visitors. However, the Bad Rotenfels hall (in Gaggenau), parking lots and access road are insufficient to meet that demand," the town's authorities said in a statement.
Bozdag condemned the move, claiming it smacked of hypocrisy.
"It is unacceptable that German authorities, who constantly lecture us about human rights, democracy, rule of law, free speech... Do not tolerate a meeting organised by the Turkish community," he said.
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