"The new airport will be the pride of our country and an example to the world," Erdogan said at a lavish opening ceremony featuring several heads of state.
At the inauguration -- which coincided with the 95th anniversary of modern Turkey's founding by Mustafa Kemal Ataturk -- Erdogan also revealed that the airport would be named "Istanbul".
"Istanbul is not only our biggest city but also the most valuable trademark of our country," he said.
The airport, one of a number of mega-projects built under Erdogan's rule, will be little used until next year after construction was marred by delays and a workers' strike over poor conditions.
Erdogan has championed the 10.5-billion euro ($12-billion) project in his bid to make Istanbul a global travel hub linking Europe, Asia and Africa and turn flag carrier Turkish Airlines into an aviation giant.
But the airport will only offer flights to five destinations until an expanded opening on December 29, from when it is expected to handle up to 90 million passengers a year, rising to up to 200 million when all facilities are completed in 2028.
That would be nearly double the 103.9 million passengers moving through the world's current busiest airport, Hartsfield-Jackson in the US city of Atlanta.
The opening ceremony was attended by several leaders including Bulgarian Prime Minister Boyko Borisov and Sudanese President Omar al-Bashir, who is wanted by the International Criminal Court on charges of genocide and war crimes.
The first flight from the new facility will be to the capital Ankara on Wednesday.
- '80 Eiffel Towers' -
It had been thought the new facility would replace the city's ageing Ataturk Airport, but Erdogan said it would remain in service, including for events such as air shows, adding that its unused parts would be transformed into a "national park as promised".
Planes and equipment are expected to be moved from Ataturk to the new facility for the expanded launch in late December.
"Ataturk Airport will continue to serve with the same name," he added.
Erdogan called the new airport a "giant", with officials saying that its 1.4 million-square metre terminal building was eight times larger than Ankara's terminal.
"Moreover, 80 Eiffel Towers could be constructed with the steel of 640,000 tonnes used in the construction."
When finished in 2028, it will have six runways and two terminals spread over 76 square kilometres (29 square miles). That would make it three times the size of Ataturk.
"With its cargo and aviation terminals, parking lots, support units, and social facilities it is a really gigantic work," said Erdogan.
Authorities say a metro line will be built to link the airport, which is near the Black Sea coast on the European side of Istanbul, to the city centre 35 kilometres (22 miles) away.
- Crackdown on striking workers -
The airport will be one of the crowning jewels in Erdogan's bid to transform Turkey's infrastructure in time for the country's centenary in 2023.
Other massive projects include a third bridge over the Bosphorus Strait connecting Istanbul's Europe and Asia sides, opened in 2016, and a man-made canal to relieve pressure on the strait.
However, critics have blasted Erdogan's mega-projects as excessive and damaging to the environment, and the airport's construction was hit by controversy.
Last month, hundreds of workers walked off the job to protest poor conditions and work-related deaths on the site.
Turkish authorities quickly cracked down, arresting hundreds, according to labour unions. Most were released without charge, but around 20 remain in prison.
Thirty workers have died on the site since construction began in 2015, according to Istanbul airport authorities. The unions say the real number is much higher.
Construction Union Insaat-Is announced on Twitter that another worker died from a fall on Sunday, just one day before the inauguration.
In his speech, Erdogan thanked the workers.