The Parliamentary Assembly of the Council of Europe (PACE) approved a resolution on Tuesday to impose a fresh monitoring procedure on Turkey.
The PACE resolution cited concerns over Ankara's crackdown on dissent, as well as the state of democracy, rule of law and human rights since last year's failed coup attempt.
Lawmakers also called on Turkey to lift its state of emergency "as soon as possible" and to release imprisoned journalists and members of parliament pending trial.
The Council of Europe applies its human rights monitoring procedure to all countries when they join, but Tuesday marked the first time such a probe has been reopened against any member of the council.
Turkey was previously under monitoring until 2004.
Turkey slams vote
The assembly is comprised of over 300 members of national parliaments from the Council of Europe's 47 member states, including Turkey, Russia, Ukraine and all 28 members of the EU.
The lawmakers voted by 113 in favor and 45 against reopening monitoring in Turkey "until these concerns are addressed in a satisfactory manner," while 12 abstained.
The Council of Europe is separate from the European Union, but the vote is likely to be a further setback in Turkey's bid for EU membership. Among Turkish representatives, 15 vote against the resolution and only two in favor.
Ankara sharply criticized the PACE vote, saying it smacked of Islamophobia and was a "disgrace to this organ, which claims to be the cradle of democracy."
Following the vote, the Turkish lira weakened, dipping to 3.6001 to the dollar from 3.5862.
Relations between Turkey and Europe were particularly strained during a referendum this month on granting Turkish President Recep Tayyip Erdogan more powers.
During the campaign, he accused Germany and the Netherlands of acting like Nazis by barring Turkish ministers from holding campaign rallies for the "yes" vote.
rs/rc (AFP, dpa, Reuters)