One scene was described as "like a killing field."
The violence began Wednesday after a customer and the Muslim owner of a shop had an argument and hundreds of Buddhists and Muslims arrived at the hop, Voice of America reported.
At least 10 people died Wednesday, including a Buddhist monk.
By Friday, groups of Buddhists, including monks, ransacked and burned Muslim neighborhoods in Meiktila in retaliation for the monk's death, The New York Times reported.
Reports of the death toll varied.
The BBC reported eight people died Friday, bringing the toll to 20.
Thein Sein said the state of emergency would allow the military to help restore order to Meiktila.
Nyan Lin, a former political prisoner told the Mizzima news agency police "just stood watching the rioters and did not take any action."
"The area was like a killing field," said photographer, Wunna Naing, of Meiktila. "Even the police told me that they could not handle what they witnessed. Children were among the victims."
The unrest is a result of continuing tensions between Myanmar's Buddhists and Muslims, the minority in the country.