Hi there.
I would take with you a mix of Turkish Lira and Euros, around 50/50 for what you want to spend. 99% of places take both.
you can get a good rate there, but you can also get ripped off or attract unwanted attention - I used Tesco last time and advertised rates in Turkey didn't beat them by much at all. Use moneysavingexpert.co.uk to find the best rates, there is also more advice on there. Check out tripadvisor too, for more advice.
Also don't forget a nice crisp £10 note to pay for your visa stamp on arrival - they will not take anything else except Euros and they surcharge you for using Euros.
You can often get a better price in Euros when shopping, but if not then spend the Lira first as you cannot spend it anywhere else whereas Euros are useful (and probably not worth changing back).
Travellers Cheques are a waste of time, to be honest, better off taking an emergency single credit card - tell your provider you are going to Turkey in advance - then leave it locked in your safe. You can use it for duty free on the way back if your currency is done.
Turkey has a low crime rate but there ARE pickpockets, so a moneybelt is a good idea. Take what you need with you each day, leave the bulk of the cash in the safe.
Enjoy, it is a great place!
Cheers, Steve.