Eight British men suspected of being involved in terrorist activity have been arrested in a series of raids across the south of England.
Police search the storage unit in Hanwell where fertiliser was found
More than half a ton of ammonium nitrate fertiliser was also seized from a self storage unit in west London.
Raids by five forces, involving 700 officers, were carried out on 24 premises early on Tuesday morning.
The men arrested were aged between 17 and 32 and are believed to be of Pakistani descent.
Head of Scotland Yard's terrorist branch Peter Clarke said warrants were issued under the Terrorism Act 2000.
The men, all British citizens, were arrested on suspicion of being involved in the commission, preparation or instigation of acts of terrorism.
The raids were coordinated by the Met Police's terror branch
Two were arrested in Uxbridge, west London, three in Crawley, West Sussex, and one each in Ilford, east London, Slough, Berkshire, and Horley, Surrey.
Surrey Police said the 18-year-old man arrested in Horley had been found at a Holiday Inn hotel near Gatwick Airport.
There were also raids at houses and businesses in Colindale, north London, Luton and Reading.
The suspects have been taken to two high security police stations in London for questioning.
The fertiliser was found in a lock-up in Boston Road, Hanwell, west London.
BBC security correspondent Frank Gardner said half a ton was a "massive amount".
He said ammonium nitrate was a common component in bombs and had been used in the attack in Bali in 2002.
In addition, it was used in the Istanbul bombing last year and is believed to have been used by al-Qaeda in an attack on the US embassy in Nairobi in 1998. It was also used in the Oklahoma bombing in 1995.
"If that amount had been turned into a bomb and used in central London it would have killed a lot of people," said Mr Gardner.
"They are saying this is by far and away the biggest and most important counter terrorist operation undertaken in recent years both by MI5 and by Scotland Yard."
He said MI6 had also been involved because of the international dimension of most suspected Islamist terrorist activities.
"The first phase is over but we are told to expect further activities and probably further arrests," Mr Gardner said.
Mr Clarke, who is national co-ordinator of terrorist investigations, said premises were still being searched by forensics teams.
AMMONIUM NITRATE - THE FACTS
Millions of tons produced each year for use as fertiliser
Sales of the fertiliser are tightly restricted in the EU
Mining companies mix small amounts of explosive grade ammonium nitrate with fuel oil to create explosives
It is "not impossible" to make explosives with fertiliser grade
Used in several IRA bombings
Also used in the Bali and Oklahoma City bombings
Source: New Scientist
He assured the Muslim community the police knew the "overwhelming majority are law abiding and completely reject all forms of violence".
"We have a responsibility to all communities to investigate suspected terrorist activity," he said.
He said the operation was not linked to the bombs in Madrid and there had been no danger to the public.
Mr Clarke said: "Today's operation is part of continuing and extensive inquiries by police and the security service into alleged international terrorist activity and I must stress that the threat from terrorism remains very real. The public must remain watchful and alert."
But Massoud Shadjareh, chairman of the Islamic Human Rights Commission, claimed the Muslim community was being "demonised" as a result of such raids.
He said: "These raids are usually given a lot of importance when they are taking place, but when people are released without charge, it is not news.
"It is creating a deception in the minds of ordinary people that we have a bigger problem than we really have," he added.
Home Secretary David Blunkett said after the raids: "While it is for the appropriate authorities to decide what action is taken against those individuals arrested today, the fact that such action was felt necessary is a timely reminder that the UK and its interests abroad remain a target."