Germany has told all citizens travelling to Turkey to exercise caution following the jailing of a human rights activist who had no previous links to the country.
Foreign Minister Sigmar Gabriel said the move shows that "every German citizen in Turkey" could suffer the same fate.
Mr Gabriel said he also cannot see how the German government can continue to guarantee German companies' investments in Turkey in light of the threat of "arbitrary expropriations for political reasons".
He added that Berlin will talk with its European Union partners about the future of pre-accession financial aid for Ankara, which is in slow-moving talks to join the bloc.
The German government will consider those questions and "further measures" over the coming weeks, Mr Gabriel said.
Mr Gabriel said the jailing of Peter Steudtner, who along with five others including Amnesty International's Turkey director is accused of links to terror groups, showed it was time to shed previous diplomatic restraint toward Ankara.
Mr Steudtner's arrest added to a growing list of issues that have weighed on German-Turkish relations for over a year, but particularly since the coup attempt in Turkey a year ago.
German authorities say 22 German citizens were held in Turkey in the subsequent crackdown, nine of whom remain in custody.
Alongside Mr Steudtner, they include two journalists, Deniz Yucel and Mesale Tolu, who have been accused of aiding terror groups.
Mr Steudtner and the other activists were detained in a July 5 police raid on a hotel on the island of Buyukada, off Istanbul, where they were attending a digital security workshop.
A court jailed the six, who also include a Swedish IT trainer, on Tuesday.
Amnesty International says Mr Steudtner was providing training on non-violence and wellbeing.
It is unclear which terror group the six are accused of aiding.
"The case of Peter Steudtner shows that German citizens are no longer safe from arbitrary arrests," said Mr Gabriel, who interrupted his holiday for consultations on policy toward Turkey with Chancellor Angela Merkel and other leaders.
Mr Steudtner "is not a Turkey expert, he may even have been in Turkey for the first time ... he has neither written, spoken or published about Turkey nor does he have close contacts to Turkish politicians, the opposition or society," Mr Gabriel said.
"The cases of Peter Steudtner, Deniz Yucel and Ms. Tolu are examples of the absurd accusations of terror propaganda that obviously are only meant to serve to silence every critical voice in Turkey ... and also voices from Germany," he said.
The new German travel advice stopped well short of a formal warning, but stated that "people travelling for private or business reasons to Turkey are advised to exercise elevated caution" and to register with the German embassy or consulate even for short stays.
Germany's foreign ministry summoned the Turkish ambassador Wednesday to demand Mr Steudtner's immediate release.
Turkey's Foreign Ministry on Thursday slammed "unacceptable" German statements that it described as an attempt to interfere with the Turkish judiciary.
In a statement, the ministry said that "the independent Turkish judiciary must be trusted."
There were no impediments to consular access, it said. Mr Gabriel, however, said that Germany has consistently had to fight for consular access to Germans arrested over the past year.
The foreign ministry accused Germany of applying a "double standard," saying it harbours members of terror groups and prevents their trial.
Following the failed coup attempt, more than 50,000 people have been arrested and 110,000 dismissed from their jobs for alleged links to US-based cleric Fethullah Gulen and other terror groups.
Turkish President Recep Tayyip Erdogan has repeatedly said the rights activists now arrested were involved in a meeting that had the "nature of a continuation" of the coup attempt.
"We are still interested in good and trusting relations with the Turkish government," Mr Gabriel said.
"But it takes two to tango."
Later, Turkish President Recep Tayyip Erdogan's spokesman branded as "unfortunate" comments by the German foreign minister.
Ibrahim Kalin told reporters that the German comments were "internal political investments" geared toward increasing votes at upcoming elections in the country, and urged German politicians to act in a more "rational manner".
"Those who see that animosity ... against our president helps them score points have jumped on the bandwagon," Mr Kalin said.
Mr Kalin also condemned German Foreign Minister Sigmar Gabriel's suggestions that German companies' investments in Turkey may not continue to be guaranteed.
"We strongly condemn statements that German citizens who travel to Turkey are not safe and that German companies in Turkey have hesitations and concerns," he said.
"There is no such thing."
Mr Kalin also urged Germany to respect Turkish judicial decisions, saying the group who were detained in Turkey were not ordinary visitors but "as far as the judiciary could establish (they are) people who engaged in illegal or suspicious activities".