Forty-seven year-old Darren Osborne, identified by British media as a father-of-four from the Welsh city of Cardiff, was arrested after pedestrians were targeted by a man driving a van near a mosque in north London.
The attack is the fourth since March in Britain and the third to involve a vehicle deliberately driven at pedestrians.
British authorities have confirmed an elderly man who was receiving first aid before the incident near the Finsbury Park mosque has died, although it's not yet clear if that was a result of the attack.
London's Metropolitan Police Commissioner, Cressida Dick, says there are a number of people in hospital whose lives have been turned upside down.
"This was quite clearly an attack on Muslims, who looked like they were probably Muslims and they were coming from a prayer meeting. We treat this as a terrorist attack and we in the Met (Metropolitan Police) are as shocked as anybody in this local community or across the country."
Meanwhile London's mayor, Sadiq Khan, says extra police have been deployed to reassure the public.
"My message to Londoners and those across the country is to be calm, but vigilant. There will be an increased visible policing presence in London today at and around mosques and places of worship."
Meanwhile, Britain's Prime Minister Theresa May was heckled by protesters after visiting the mosque.
It follows anger at her delay in visiting victims of London's other recent tragedy - the Grenfell Tower fire, in which dozens of people died.
Speaking later outside 10 Downing Street, Ms May vowed to fight terror in all forms.
"This was an attack on Muslims near their place of worship and, like all terrorism in whatever form, it shares the same fundamental goal: it seeks to drive us apart and to break the precious bonds of solidarity and citizenship that we share in this country. We will not let this happen."
Opposition Labour leader and local MP Jeremy Corbyn has praised the emergency services.
"I know that people in Muslim Welfare House and the mosque extremely well and the community very well. I came here last night to talk to the police and the firefighters and the ambulances that were here and I have to say the response by all three emergency services was very timely and very quick."
In Cardiff, neighbours of suspect Darren Osborne describe him as an "everyday guy".
Khadijah and her Pakistani husband live next door to him.
"He was never unpleasant to me or anything and we've been here since April. And I just didn't suspect him of anything, that his views were that strong, or that he even hated Muslims, with us being Muslims as well next door. So, I think it's just a shock that he's done what he's done."
Farhad Ahmad, Imam of the Ahmadiyya Muslim Community, says there's an urgent need for the government to clamp down on platforms where extremism is brewing.
"We're saying that if there is far right extremists who are promoting their message, they should really be clamped down on - just as if there are Muslims who are preaching hate to increase extremism in their communities. They need to be clamped down (on) because both of these ideologies are completely wrong and they don't represent any faith at all. If there are universities that are giving platforms to hate preachers from any aspect - far right extremists or certain Muslims who claim that their faith is encouraging this which it isn't - any angle which people are promoting extremism through needs to be tackled. Hate preachers should not get a platform, even on social media - wherever a hate preacher is, it should be clamped down on."
