The raids spanned Germany, from Essen to Munich
The federal prosecutor, Kay Nehm, said warrants had been issued for six of the 13 suspected Islamic extremists detained in a series of raids around the country on charges of membership of a terrorist organisation.
A seventh is accused of supporting a terrorist organisation.
Mr Nehm said the group was a cell of the Palestinian al-Tawhid organisation, which had been planning attacks in response to events in the Middle East and in Afghanistan.
Nail bomb rumours
However, he denied media reports that the suspects had been planning a nail bomb attack.
A report by the Bild Zeitung that a large number of nails discovered during the police raids was not true he said.
A source close to the investigation also told Bild that the suspects had attempted to acquire bomb-making chemicals.
Two of the suspects were detained in Essen on Wednesday, following the arrest of 11 others in cities around Germany on Tuesday.
Mr Nehm said that al-Tawhid was a loose group inspired by a spiritual leader known as Abu Qatadah.
He was last seen in Britain in December but disappeared just after the parliament there passed new internment laws in response to the 11 September attacks on America.
'Convicted terrorist'
Abu Qatadah has been convicted in absentia by a military court in Jordan of planning attacks on American and Israeli targets.
Mr Nehm said that the group revolved around one of the suspects picked up on Tuesday, a 36-year-old Iraqi-born Palestinian named only as Yasser H, who had led a branch of al-Tawhid in Jordan.
According to the prosecutor's office, the German cell was primarily involved in supplying fake identity documents and gathering donations, but had initially helped to provide logistical aid for fighters campaigning against Western forces in Afghanistan.
"On the basis of our current knowledge, the group is part of an international network which helped provide logistical and financial support," it said, adding that it believed the group's European headquarters to be in Britain.
German television has also reported that the authorities believe several of those arrested attended training camps in Afghanistan and had already acquired weapons for specific missions.
During the raids, computers, software, forgery equipment and bundles of written documents were seized.
Security concerns
Germany has been on high alert following an attack on a synagogue on the Tunisian island of Djerba, in which 16 people, including 11 German tourists died.
Chancellor Gerhard Schroeder on Thursday promised his government would do everything to ensure a full investigation of the attack.
Security is also tight as the trial of five men over a plot to attack the Strasbourg Christmas market takes place in Frankfurt.
There are particular concerns that Jewish people and property could be targeted and the interior minister has called for extra precautions.