At least three shots were heard and people described seeing two people laid on the ground.
There were reports that a car ploughed into pedestrians on Westminster Bridge just before the incident leaving up to a dozen injured.
Injured man on Westminster Bridge
Minutes after the incident an emergency helicopter landed in Parliament Square as sirens were heard ouside. Air ambulance medics ran from the helicopter towards the casualties on the ground.
There were reports that multiple people had been injured.Staff inside Westminster were told to stay in their offices and the Prime Minister was reportedly bundled away from parliament. Parliament has been suspended.
Witnesses describe 'Asian guy' in his 40s carrying eight-inch long knife
Witnesses described seeing a middle-aged man carrying a knife and running. Jayne Wilkinson said:
"We were taking photos of Big Ben and we saw all the people running towards us, and then there was an Asian guy in about his 40s carrying a knife about seven or eight inches long.
"And then there were three shots fired, and then we crossed the road and looked over. The man was on the floor with blood.
"He had a lightweight jacket on, dark trousers and a shirt. He was running through those gates, towards Parliament, and the police were chasing him."
3:35pm
Police treat attack as 'terrorist incident'
Scotland Yard said the attack in Westminster was being treated "as a terrorist incident until we know otherwise".
3:30pm
Pictured: Theresa May being driven away from Westminster
Prime Minister Theresa May was seen being ushered into a silver Jaguar car as what sounded like gunfire rang out at Parliament during the incident.
'We literally just heard shots and then saw people running'
A woman at the scene was on the opposite side of the square when she heard shots ring out at about 2.45pm. She said:
"We literally just heard shots and then saw people running, and we went to have a look. I saw a body, they were working on the floor. They were just inside the gates.
"He had one gunshot wound to the right side of his chest. I don't know if he was dead or alive, but people were working on him.
"I saw that needed medical attention and I asked if I could help because I am a doctor, but they said they were fine. Then the police moved us back."
— Claudia (@claudiascore) March 22, 2017
Commons leader's statement to MPs
Commons Leader David Lidington told MPs: "What I am able to say to the House is there has been a serious incident within the estate.
"It seems that a police officer has been stabbed, that the alleged assailant was shot by armed police.
"An air ambulance is currently attending the scene to remove the casualties.
"There are also reports of further violent incidents in the vicinity of the Palace of Westminster but I hope colleagues on all sides will appreciate that it'd be wrong of me to go into further details until we have confirmation from the police and from the House security authorities about what is going on."
3:19pm
Downing Street not involved in attack, source confirms
A Downing Street source declined to say where Theresa May had been during the attack, but said she had not been involved.
3:19pm
'They were running for their lives'
Dennis Burns, who was just entering Parliament for a meeting when the security alert happened, told the Press Association: "As I was coming through the doors at Portcullis House, a policeman grabbed someone who was coming in and threw him out.
"As we were coming though the glass doors I was told by one security guard to get out while another one told me to get in.
"As I walked in I heard a security guard get a radio message saying 'a policeman has been stabbed'.
"Then I walked in as police officers and security start rushing out of the front doors on to the street.
"When I got inside I was wondering what the hell was going on and I saw dozens of panicked people running down the street. The first stream was around 30 people and the second stream was 70 people.
"It looked like they were running for their lives."
Shooting and people getting run over by a car @ Westminster pic.twitter.com/hwbE4LWMlc
— OllyAston (@OllyAston) March 22, 2017
3:05pm
Commons leader tells MP police officer has been stabbed
Commons Leader David Lidington has told MPs a "police officer has been stabbed" and the "alleged assailant was shot by armed police" following a "serious" incident within the parliamentary estate.
3:04pm
Helicopter lands in Parliament Square
Minutes after the incident, an emergency services helicopter landed in Parliament Square, as sirens were heard outside.
Air ambulance medics came from the helicopter to assist the casualties
Air ambulance just landed at Parliament Square, Westminster, dozens of police cars pic.twitter.com/TZVTO6IzDR
— Peter Yeung (@ptr_yeung) March 22, 2017
Two people lay on the ground in the yard. One of them appeared to have had clothes removed as emergency workers attempted to resuscitate the pair.
Parliament Square was closed to traffic.
2:56 PM
Scotland Yard confirms reports of several people injured on Westminster Bridge
Scotland Yard said it was called to a firearms incident on Westminster Bridge amid reports of several people injured.
2:56pm
Staff told to stay inside Parliament
Staff inside Parliament were told to stay inside their offices.
2:52pm
House of Commons suspended
Two people were seen lying within Old Palace Yard, immediately outside Westminster Hall.
The sitting in the House of Commons has been suspended while police officers sealed off the area around the incident.
We are being told to stay inside our offices. Police now patrolling the inside of the building.
— Gordon Rayner (@gordonrayner) March 22, 2017
Loud noise that sounded like a car crash, followed by screams, followed by a handful of people rushing the gates of parly opp Parliament Sq
— Gordon Rayner (@gordonrayner) March 22, 2017
...followed by an armed officer shooting a man three times in the chest from about 6ft away
— Gordon Rayner (@gordonrayner) March 22, 2017
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