The unrest also underscored the struggle over the direction of Egypt's turbulent passage nearly two years after a popular uprising toppled Hosni Mubarak's authoritarian regime. Liberals and secular Egyptians accuse the Brotherhood of monopolizing power, dominating the writing of a new constitution, and failing to tackle the country's chronic economic and security problems.
"I don't like, want or need to resort to exceptional measures, but I will if I see that my people, nation and the revolution of Egypt are in danger," Morsi told thousands of his chanting supporters outside the presidential palace in Cairo.
But even before he spoke, thousands from each camp demonstrated in major cities, and violence broke out in several places, leaving at least 100 wounded, according to security officials.
Security forces pumped volleys of tear gas at thousands of pro-democracy protesters clashing with riot police on streets several blocks from Cairo's Tahrir Square, birthplace of the Arab Spring, and in front of the nearby parliament building. Young protesters set fire to tree branches to counter the gas, and a residential building and a police vehicle also were burned.
Tens of thousands of activists massed in Tahrir Square itself, denouncing Morsi. In a throwback to last year's 18-day anti-Mubarak uprising, they chanted the iconic slogan first heard in Tunisia in late 2010: "The people want to overthrow the regime." They also yelled, " Erhal, erhal," - Arabic for "leave, leave."
Outside a mosque in the Mediterranean city of Alexandria, anti-Morsi crowds threw stones and firecrackers on Brotherhood backers who used prayer rugs to protect themselves, injuring at least 15. The protesters then stormed a nearby Brotherhood office.
State television reported that offices of the Brotherhood's political arm were burned in the Suez Canal cities of Suez, Ismailia, and Port Said, east of Cairo.
Morsi and the Brotherhood contend that supporters of the old regime are holding up progress toward democracy. They have focused on the judiciary, which many Egyptians see as too much under the sway of Mubarak-era judges and prosecutors and which has shaken up the political process several times with its rulings, including dissolving the lower house of parliament, which the Brotherhood led.
His edicts effectively shut down the judiciary's ability to do so again. At the same time, the courts were the only civilian branch of government with a degree of independence. Morsi already holds not only executive power but also legislative authority, since there is no parliament.
His move came as he was enjoying praise from President Obama and Secretary of State Hillary Rodham Clinton for brokering a cease-fire between Israel and Hamas on Wednesday.