Police have arrested a man on terrorism charges after he intentionally drove through cyclists before ramming security barriers outside Britain’s Houses of Parliament.

Three people were injured in the incident that occurred during the early morning rush hour Tuesday local time.

The driver, a British man in his late 20s, was arrested by armed officers at the scene moments later.

“Given that this appears to be a deliberate act, the method, and this being an iconic site, we are treating it as a terrorist incident,” London Assistant Commissioner Neil Basu said Tuesday night (AEST).

Assistant Commissioner Basu said the man was alone in the silver Ford Fiesta during the incident and no weapons were found.

The suspect, who has not been formally identified, was being held at a south London police station and the vehicle was being searched.

British media report the man is from the Birmingham area.

“Our priority is to formally identify the suspect and establish his motivations if we can. He is not currently co-operating,” Assistant Commissioner Basu said.

“However, as you would expect, detectives from the Counter Terrorism Command are making various other urgent inquiries to ensure there is no outstanding risk to the public,” he added.

Police cordon off the area near the Houses of Parliament on Tuesday. Photo: EPA

Camera footage showed the vehicle taking a wrong turn into a group of cyclists waiting at traffic lights before veering across the road and into a lane leading to Parliament before hitting the barrier as two police officers jumped to safety.

The British government held a special meeting of its Cobra emergency committee Wednesday morning (AEST), where the Prime Minister Theresa May  paid tribute to the “formidable courage” and professionalism of the emergency services who “ran towards a dangerous situation in order to protect the public”.

London Ambulance Service’s Assistant Director of Operations Peter Rhodes said two people were treated at the scene for injuries “that are not believed to be serious”. They were taken to hospital.

Assistant Commissioner Basu said one man had since been discharged Tuesday, but a woman remained in hospital for serious, but non-life-threatening, injuries.

Another man was also treated at the scene but didn’t require hospital treatment.

Police cordoned off nearby streets and closed the Westminster underground station as Metropolitan Police announced on Twitter its counter-terrorism command was taking charge.

Breaking: Big armed police response to car which has cashed into Parliament barriers we are now being moved back pic.twitter.com/rYAqExq6rn

— Vincent McAviney (@VinnyMcAv) August 14, 2018

Major incident at #Westminster @HouseofCommons car driving wrong side of road and knocking down cyclists. One person said smoke coming from car and concerns over potential device in car. On a personal note – I missed this by seconds. Could have been one of those cyclists.

— James Maker (@james_maker) August 14, 2018

Dozens of emergency vehicles swarmed around Parliament Square in Westminster in the immediate aftermath of the incident.

Video showed smoke coming from the bonnet of the vehicle and police officers urging people to leave the scene and find alternative routes.

Armed officers could be seen surrounding the car before leading a man away in handcuffs.

https://twitter.com/cpfcdazzler/status/1029258210799169537

The Houses of Parliament are surrounded with security barriers of steel and concrete.

The measures were extended in the wake of the Westminster Bridge attack in March 2017 when Khalid Masood ploughed a car into crowds on Westminster Bridge, killing four people.

Masood abandoned his car then stabbed and killed unarmed police officer Keith Palmer before he was shot by armed police in a courtyard outside parliament.

-wit agencies