A 'viable device' found on a London Underground train was part of a plot to attack the transport network, it is believed.
A 19-year-old man was Tasered and arrested under the Terrorism Act today after a suspicious package was exploded on a train.
The teenager was detained at 12.20pm in Holloway, North London, one day after the item was detonated in a controlled explosion at North Greenwich station.
And the Ministry Of Defence told its staff in a memo that the culprit could have planted more devices, according to The Telegraph.
It said: 'This increase is in response to the discovery of a suspected viable improvised explosive device (IED) on a London Underground train yesterday.
'It is unknown who placed the device and what their motivation was. Therefore it remains possible that the perpetrator may attempt to place further devices.
The threat level will continue to be reviewed as further information is received.'
Witnesses described how officers shouted 'armed police, don't struggle´ as they arrested the white bearded man wearing a hoodie, jacket, jeans and trainers.
Security has been ramped up on London's public transport network since with more officers, including armed police, on patrol at travel hubs and high visibility patrols.
Yesterday, passengers were evacuated from the station near The O2 Arena in East London as alarm bells rang and a huge section of the Jubilee line was suspended.
Shortly after 11am, travellers were told to leave the station which was closed for more than seven hours while the item was made safe underground.
Officers from the Metropolitan Police's counter terrorism command launched a probe after the package was found by train staff on an eastbound service.
No trains were running between Stratford and Canary Wharf until about 3.15pm, while buses were also unable to call at the station for hours yesterday.
Police launched an appeal for information and detectives from the counter terrorism command and armed colleagues arrested the man in the street today.
Officers used a Taser during the arrest on Holloway Road, but said no firearms were used. The man was taken to a police station where he remained in custody.
Community support worker Margaret Mathurin was sat having a coffee when, at just past midday, the incident began to unfold.
The 54-year-old did not see the arrest, but added: 'The police all lined up in their cars and vans, they gave their orders to each other.
'They were plain-clothed police with masks, they had guns, everything. It was very unnerving.
'It was quick and it just looked like they were giving orders to each other and they knew exactly where to be, where to stand. Everything looked pretty organised.'
The arrested man was white, bearded and wearing a hoodie, a witness said. Ali said the man had been walking along the street 'normally' when police descended.
'The armed police, I think five of them, ran behind him and put him on the floor.'
Ali, 30, who did not want to give his full name, said he did not see the man Tasered, but that he did see the Taser on the floor.
'He was struggling not to get arrested, for like a good five minutes. They were shouting 'armed police, don't struggle'. Everything happened so quick.'
He described the arrested man as in his early twenties, white, bearded, and that he was wearing a hoodie, a long jacket, jeans and trainers.
'He did not look like he had had a shave for a long time,' he added.
She added: 'They lined up with their guns and blocked the road. Nobody was allowed to go through but I was watching from Costa's window.
'I haven't moved from this spot since. The whole thing was unfolding before me.
'Although it was unnerving to see armed police on the streets of London I have to say it looked like they had control of the situation and knew what they were doing.
'The arrest must have taken place under the bridge. I don't normally come to this area so it's a bit scary that on the day I decide to this happens.'
Another customer saw the commotion and said there are rumours the suspect was brandishing a weapon.
Rafik, who didn't want to give his last name, said: 'I've heard that somebody was waiving a gun and then got Tasered. There were a lot of police vans here.'
Emi Koizumi, 42, described the terrifying moment armed police swarmed the road as he walked to get lunch at a nearby Dirty Burger restaurant.
She said: 'We saw loads of police, including armed and also plain clothed police with their faces covered.
'The plain clothed police ran off down the street towards Highbury Corner right as we walked up. No one would tell us what was going on under the railway bridge.'
Police said the suspicious item found at North Greenwich was 'being forensically examined and we await the results of that examination'.
The Met added that officers from the force and British Transport Police 'have been working tirelessly since the item was found to follow up all potential leads'.
Officers are keeping an open mind regarding any possible motive. They are not looking for anyone else in relation to this investigation at this stage.
Mayor of London Sadiq Khan said: 'Thanks to the outstanding professionalism of the Metropolitan Police, Transport for London staff and the British Transport Police, this situation was dealt with swiftly and safely, and no injuries resulted.
'I have been in constant contact with the Metropolitan Police commissioner and the TfL commissioner throughout the past two days.
'Keeping Londoners safe is my highest priority. I am urging all Londoners to check with TfL before they travel and to remain calm and vigilant at all times.'
A Met spokesman said: 'Officers continue to encourage the public to remain vigilant and alert at all times and report anything suspicious to police.
'The public will see more officers, including armed police, in and around transport hubs to provide reassurance around public safety.
'High visibility patrols by BTP officers on the underground and at stations will remain in place today to reassure the travelling public as they start their weekend.
'Anyone with any concerns should speak with officers who will be happy to help.'
Police urged anyone who saw anything suspicious on the train, or anywhere else, to call the anti-terrorist Hotline on 0800 789 321.
The current threat level for international terrorism in the UK is severe - meaning an attack is 'highly likely'.
Will Geddes, founder of private security firm International Corporate Protection, said the Tube network was 'pretty safe' and that the Jubilee line was the most modern.
He added: 'There's very extensive CCTV and security measures which will have expedited the process of identifying the suspect.
'If they used an Oyster card it's another identifier that links the suspect to the package.
'In terms of the response by the authorities it couldn't have been more efficient and effective, which provides reassurance to the general public in how capable and rehearsed our authorities and emergency services are in responding to these kind of events.'
Transport Salaried Staffs' Association general secretary Manuel Cortes said: 'Once again we are reminded of the real threats now posed to public transport passengers and, in this case, our Tube and station staff.
'I have called for an urgent security summit with TfL London Underground, unions, British Transport Police, Scotland Yard and the City Hall.
'In the light of yesterday's all too real attack, the Chancellor Philip Hammond must immediately restore the cuts made last year by George Osborne to Transport for London's operating subsidy which means TfL are trying to make £700 million of cuts by 2020.
'Without reversing Osborne's devastating cuts, it will simply not be possible for TfL managers or British Transport Police or my members to exercise the levels of vigilance now necessary to keep London open for business and our people and our passengers safe.'
North Greenwich station reopened on Thursday night and a performance at the O2 by the band Nickelback went ahead as planned.