The move, announced by Foreign Minister Ahmet Davutoglu in an interview late on Wednesday, was a step to ease tensions over a highly sensitive issue which has cast a shadow over efforts to normalize ties between arch-rivals Turkey and Armenia.
In a separate Armenia-related development, Turkey announced on Thursday that permission had been given for Christian worship to be held once a year at an abandoned island church restored as a museum in Eastern Turkey's Lake Van.
The recall of the envoy to Sweden, a strong supporter of Turkey's bid to join the EU, came a week after Ankara recalled its ambassador to the United States because a US congressional committee approved a similar resolution on the 1915 killings.
Turkish Prime Minister Tayyip Erdogan also canceled a Turkey-Sweden summit scheduled for this month in response to the ruling which was opposed by Sweden's center-right coalition.
Turkey accepts many Christian Armenians died in partisan fighting beginning in 1915 but vehemently denies that up to 1.5 million were killed and that it amounted to genocide - a term employed by some Western historians and foreign parliaments.
Davutoglu said Ambassador Zergun Koruturk would return to her duties by the start of next week, but said Ankara was still assessing when the ambassador to Washington would return. That decision will be tied to the fate of the US resolution.
"The examples of the United States and Sweden are not the same. The Swedish government clearly showed its opposition to acceptance of the bill," he said.
Separately, the Culture Ministry has given its approval for a religious service to be held once a year in the recently restored Armenian church on the island of Akdamar in Van province, the regional governor's office said.
The 10th-Century church is located in eastern Turkey, which was home to ethnic Armenians before World War I. It reopened in 2007 as a museum. The site has significant symbolic importance for Armenians, and religious leaders had suggested that religious services be allowed once a year. The Van governor's office had last year sought permission from the ministry for such a ceremony and the governor was reported as saying by state-run Anatolian news agency that the decision would boost faith tourism in the region.
"Nobody should have any doubt that we will welcome our guests from home and abroad in the best possible way on Sept. 12," Governor Munir Karaloglu said.
The decision came amid mutual recriminations between Turkey and Armenia over the lack of progress on accords which they signed last year to establish diplomatic ties and open their border. Neither parliament has yet approved the protocols.
Relations have also been soured this month by Erdogan's threat to deport thousands of Armenian migrants working illegally in Turkey.
Neighboring Armenia has compared Erdogan's warning to the language that preceded the 1915 mass killings.
