In one of his harshest attacks, Schulz took direct aim at Merkel's dealing with Turkish President Recep Tayyip Erdoğan, amid growing tension between Berlin and Ankara over the arrests of German citizens in Turkey, where 12 Germans are now being held as political prisoners, according to the government in Berlin.
But the Chancellor was "outfoxed" by Schulz last night, and "bounced" into getting off the fence and promising she would speak to her European Union colleagues to agree to end Turkey's accession talks, says Reuters.
Mrs Merkel was some 14 points ahead of Mr Schulz in opinion polls before the debate.
But, while viewers were impressed with his aggression, they judged Ms Merkel the overall victor of the encounter. However, according to the quick poll by Infratest dimap after the debate, about 55 per cent respondents believed that Merkel was more convincing, against 35 per cent of that of Schulz.More news: Are Analysts Bullish Workspace Group plc (LON:WKP) After Last Week?
Sunday's TV clash had been touted as Schulz's last chance to sway millions to his cause and halt a devastating popularity slide.
Schulz said that he agreed with the policy of granting asylum to those in need and argued that Germany had to meet its global commitments.
While Merkel has often spoken of her long-term vision of a carbon-free economy dominated by green-tech and climate friendly e-mobility, she has made clear that, when it comes to the diesel issue, "this is 2017".
The moment was all the more dramatic because by being the first to pledge ending accession talks, Mr Schulz broke with an SPD tradition in which the party has always been more positive about Ankara's European Union bid than Ms Merkel's conservative Christian Democrats.More news: Hurricane Irma Saturday Evening Update
Merkel called for cooperation with Turkey, Libya, Niger and other countries in solving refugee and immigration issues, and in the meantime opening channels for legal immigration.
Brussels, which has already frozen Turkey's entry negotiations, is now likely to consider further actions.
No - she is sure to lead a coalition government, once again. "There are moments in the life of a chancellor where you have to make a decision", she said.
The Social Democrats had hoped to gain some ground in this debate - the only one before the vote on 24 September. The numbers have changed little since late spring, when a surge of support that Mr Schulz secured when he took over the SPD in January, fizzled out.More news: South Korean military says North has conducted sixth nuclear test