Mr Erdogan and Mr Ahmadinejad were due to discuss Iran's nuclear strategy
Mahmoud Ahmadinejad is in Istanbul for a one-day Islamic summit as pressure mounts on Tehran to agree to a UN-brokered plan on its nuclear programme.
Iran's president is among the speakers at a meeting of the Organisation of the Islamic Conference, a 57-state bloc.
Presidents Bashar Assad of Syria and Hamid Karzai of Afghanistan are also attending the meeting.
But Sudanese President Omar al-Bashir, indicted by the International Criminal Court, has pulled out of the summit.
Sudan's state-run Suna news agency said "new developments" had required Mr Bashir's presence in Sudan.
The Turkish government had previously welcomed the attendance of Mr Bashir at the meeting and said that he would not be arrested, as Turkey was not a signatory to the treaty which set up the Hague-based ICC.
Turkish Prime Minister Recep Tayyip Erdogan went as far as saying over the weekend that no war crimes had occurred in Darfur and that he would be more comfortable meeting Sudan's president than the prime minister of Israel.
But the EU, which Turkey hopes to join, wanted the invitation to be withdrawn.
The focus of Monday's meeting is on developing closer trade ties and addressing poverty.
Jonathan Head, Istanbul
Turkey's relations with Israel, once quite close, have plummeted in recent months. Yet Mr Erdogan and his ministers insist there's been no shift in foreign policy.
His government has made rapid progress in its eastern policy with new dawns pronounced recently in relations with Iran, Iraq, Syria and Armenia.
Much of this effort is about creating new opportunities for Turkey's powerful business sector. But Mr Erdogan clearly sees his country as a rising regional power.
The United States, a close military ally, has so far kept quiet about Turkey's eastern ambitions and may even hope to reap some benefit.
But with its EU membership drive running out of steam, there is growing anxiety about where the country is heading.
Addressing the summit, Mr Ahmadinejad blamed the global economic meltdown on capitalist excesses which he said were un-Islamic.
He did not refer to Tehran's dispute with the international community over its nuclear programme, although this was on the agenda in his talks with Mr Erdogan and Turkish President Abdullah Gul on Sunday.
Last month Mr Erdogan pronounced Iran's nuclear programme to be entirely peaceful, and he has defended his country's recent diplomatic moves to strengthen ties with its Muslim neighbours, saying that Turkey's foreign policy was not shifting its direction or its axis.
In recent weeks Turkey has announced improved relations with Iran, Syria and Iraq, but links with Israel have sharply deteriorated, says the BBC's Jonathan Head in Istanbul.
Mr Erdogan had earlier questioned the ICC charges against Mr Bashir, saying that "no Muslim could perpetrate a genocide", according to Turkey's Anatolia news agency.
The ICC arrest warrant accuses Mr Bashir of running a campaign of genocide that killed 35,000 people outright, at least another 100,000 through a "slow death" and of forcing 2.5 million to flee their homes in Darfur.