Swedish police say they have arrested four suspected Muslim militants.
Persson says Sweden's Muslims include militant sympathisers
They were detained in operations in the capital, Stockholm, and the southern city of Malmo on Monday, police said.
Officials say the four have links with "Islamic extremism" outside Europe, but gave no details. Prime Minister Goran Persson welcomed the arrests.
According to Swedish media reports, the suspects are of foreign origin and were detained in connection with attacks on US-led forces in Iraq.
One newspaper said the arrests were made "based on information that US authorities sent to Sweden".
Mr Persson declared the arrests justified "in a law-and-order society".
An outspoken critic of the US-led invasion of Iraq, the prime minister said he was not surprised that suspected militants had been caught in his country - which is neutral.
"The fight against terrorism must take place also in Sweden," he said.
Mr Persson said: "We have long received many people [from abroad] in Sweden.
"Among them there are of course people who sympathise strongly with groups today connected to terror activities."
More than 400,000 Muslims live in the country.
However a spokesman for the community implicitly condemned the arrests.
Mahmoud Aldebe, chairman of Sweden's Association of Muslims, said there was not "a single Muslim in Sweden who
deserves to be called terrorist".
"Since 11 September discrimination against Muslims and Arabs has burst into the open," he added.