The raids on Zaman newspaper and Samanyolu television marked an escalation of Erdogan's battle with former ally Gulen, with whom he has been in open conflict since a graft investigation targeting Erdogan's inner circle emerged a year ago.
"The free press cannot be silenced," a crowd chanted at the offices of Zaman as its editor Ekrem Dumanli made a speech defiantly challenging police to detain him, while elsewhere in Istanbul the chairman of Samanyolu TV was being detained.
"This is a shameful sight for Turkey," Samanyolu TV group chairman Hidayet Karaca told reporters just before he himself was held.
"Sadly in 21st Century Turkey this is the treatment they dish out to a media group with tens of television and radio stations, internet media and magazines."
Media reports said arrest warrants had been issued for 32 people. State broadcaster TRT Haber said 23 people had been detained in raids across EU-candidate Turkey, including two former police chiefs. As well as Karaca, a television producer, a director and scriptwriters were held, Reuters reported.
Erdogan, his AK Party elected in 2002, introduced many democratic reforms in his first years in power and curbed army involvement in politics.
English-language Today's Zaman editor Bulent Kenes told Reuters police had shown them documentation which referred to a charge of 'forming a gang to try and seize state sovereignty'.