High Election Board Chairman Sadi Guven told reporters the CHP Istanbul candidate Ekrem Imamoglu had 4,159,650 votes, while the AKP candidate, former Prime Minister Binali Yildirim, had 4,131,761 votes.
"If one vote is filled in incorrectly in each ballot box, this equals 31,136 votes, which is more than the difference", Yildirim said.
Sezgin Tanrikulu, a CHP MP from Istanbul, said that although Imamoglu won the race in Istanbul, the election board was waiting for the objection period to end for legal reasons to declare the official victor.
Though the results for capital are worrying for the president, all is not over for the AKP leader as the People's Alliance led by the party has won 51.7 percent of the nationwide vote, according to unofficial results.
The mayor's seat in the city of 15 million is hugely important. Erdogan's own ascent to power began as Istanbul mayor in 1994.
The Ankara mayoral post is now in opposition hands.
Senocak said party officials had come across a large number of irregularities and that these may be enough to change the outcome of elections in Turkey's most populous province.
Unlike Istanbul, where there were allegations of some serious letup in vote-counting, Mansur Yavaş scored a clear victory.
While Sunday's local elections carry less importance after Turkey's assumption of an executive presidential system in 2017, they are widely seen as the most important test of President Recep Tayyip Erdogan's presidency yet.
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Erdogan acknowledged setbacks in a speech to his supporters, saying his party would work to understand what had gone wrong and fix the problem.
"I am afraid we. are not fully convinced that Turkey now has the free and fair electoral environment which is necessary for genuinely democratic elections in line with European values and principles", said Mr Andrew Dawson.
Over the past year, Erdogan has faced ire for an economic recession which heralds double-digit inflation, rising costs of living and high unemployment. Amid a media blackout and despite significant losses in the region, it regained the municipal mayor in the Kurds' symbolic capital, Diyarbakir.
"The government should respect the results".
The Council of Europe in its statement acknowledged Turkey's security concerns but said Turkey's definition of terrorism was not consistent with European standards.
"After the contesting processes have been finalized, the Supreme Election Council will make the final call on results". The opposition also increased its support along the Mediterranean, taking the city of Adana from the nationalists and the resort destination of Antalya from the ruling party.
"The people have voted in favour of democracy, they have chosen democracy", said opposition leader Kemal Kilicdaroglu, whose secularist CHP also held its Aegean coastal stronghold of Izmir, Turkey's third largest city.
"We have won the election in Istanbul".
A strategic decision by a pro-Kurdish party to sit out critical races in major cities contributed to the opposition's gains.