A KNIFE rampage in central London has been declared a terror incident, with police confirming the suspect was shot dead by armed officers on London Bridge.

Several people were stabbed by the knifeman before he was grappled to the ground and disarmed by members of the public.

Footage on social media appeared to show one man being pulled away by armed officers before the suspect was shot at point-blank range.

Another bystander could be seen carrying a large knife away from the scene.

South Wales Argus: Traffic on London Bridge came to a standstill following the knife rampage terror attack. Picture: SophK05/PA WireTraffic on London Bridge came to a standstill following the knife rampage terror attack. Picture: SophK05/PA Wire

Eye-witnesses said the suspect appeared to be wearing a suicide vest but Neil Basu, the head of UK counter-terrorism policing, said the vest was a fake.

He said police were called at around 2pm on Friday to a stabbing "at a premises near London Bridge".

Borough Market, at the opposite end of the bridge to where the suspect was shot, was cordoned off in the wake of the incident.

South Wales Argus: A police boat on the River Thames near London bridge following the incident. Picture: Dominic Lipinski/PA WireA police boat on the River Thames near London bridge following the incident. Picture: Dominic Lipinski/PA Wire

The bridge and the market were the scene of a terror attack in 2017 in which eight victims were killed along with the three terrorists.

After being shot, the suspect in Friday's attack raised his arms towards his head before lying still.

Mr Basu told reporters: "A male suspect was shot by specialist armed officers from City of London police and I can confirm that this suspect died at the scene."

Scotland Yard said a number of people were stabbed but did not give any details.

The London Ambulance Service declared it a major incident and one picture on social media appeared to show a body covered with a blanket.

After speaking to reporters, Mr Basu said he was going to Downing St to brief the Prime Minister.

South Wales Argus: Police forensic officers work where a man was killed on London Bridge following the incident. Picture: AP Photo/Matt DunhamPolice forensic officers work where a man was killed on London Bridge following the incident. Picture: AP Photo/Matt Dunham

Witnesses described a scene of panic around London Bridge, moments after the incident.

Nurse Jackie Bensfield, 32, described how she asked to be let off a bus on London Bridge after she heard "five or six" gunshots.

Ms Bensfield, who was on her way home from work, said she exited the bus and "ran like hell" to escape the shots.

Connor Allen, who was in his van on the bridge when it was evacuated said: "Everyone just started running, you heard these pops and that was it. We just got out the van and started running."

South Wales Argus: Police on Cannon Street near the scene of the London Bridge terror attack. Picture: Kirsty O'Connor/PA WirePolice on Cannon Street near the scene of the London Bridge terror attack. Picture: Kirsty O'Connor/PA Wire

Footage from the scene appeared to show a white lorry straddling the northbound and southbound carriageways.

The video shows several officers surrounding the vehicle before moving to the rear to check its container.

London buses can be seen either side of the lorry while three police cars are parked next to it on the bridge.