There were three explosions on the Underground - which police said left 33 dead - and one on a double-decker bus in which an unknown number died.

UK Prime Minister Tony Blair, who has returned to London from the G8 summit, has described the attack as "barbaric".

An Islamist website has posted a statement - purportedly from al-Qaeda - claiming it was behind the attacks.

The Queen said she was "deeply shocked" and sent her sympathy to those affected and the Union Jack was flying at half mast over Buckingham Palace.

US President George Bush told reporters at the G8 Summit in Gleneagles that "the war on terror goes on."

All London Underground services have been suspended until at least Friday.

Bus services have resumed in central London (Zone One) with diversions in affected areas. Most mainline train stations are open.

Metropolitan Police Deputy Assistant Commissioner Brian Paddick confirmed 33 people had died in the blasts on the Underground.

He said there were 21 confirmed fatalities following the blast at 0856 BST in a tunnel between King's Cross and Russell Square.

There were seven confirmed deaths after a blast at 0851 BST 100 yards into a tunnel from Liverpool Street station. The train was either a Central Line or Circle Line train.

And at 0917 BST an explosion on a train coming into Edgware Road underground station blew a hole through a wall onto another train in an adjoining platform.

Three trains were thought to be involved and there were five confirmed deaths so far, Mr Paddick said.

He said it was not yet known how many died in the bus blast at 0947 at the junction of Upper Woburn Place and Tavistock Square.

London Ambulance Service said it had treated 45 patients with serious or critical injuries including burns, amputations, chest and blast injuries and fractured limbs.

Some 300 more people were treated for minor injuries including lacerations and smoke inhalation, LAS assistant chief officer Russell Smith added.

In other developments:

• The officer in charge of policing the G8 summit said many of the 1,500 Metropolitan Police officers in Scotland would be urgently redeployed to London

• The police set up a casualty bureau number on 0870 1566344

• New Olympics minister Tessa Jowell said celebrations to mark the homecoming from Singapore of the successful London Olympic bid team have been cancelled

• Pope Benedict said the blasts were "barbaric acts against humanity" in a message to the Archbishop of Westminster Cardinal Cormac Murphy O'Connor

• London Mayor Ken Livingstone, speaking from Singapore before flying back to the UK, said Londoners would not be divided by a "cowardly attack".

• 54 state schools were closed in Westminster

• Mobile phone services across London were jammed with all major networks reporting problems as people tried to contact relatives and friends. A spokeswoman for Vodafone said the emergency services were being given priority.

Mr Paddick confirmed police were looking into whether the bus blast was the work of a suicide bomber.

But, he added: "It could as easily be an explosive device left on the bus as the work of a suicide bomber. We are not able to determine which it was yet."

He said no warning had been given before the blasts and that no-one had yet claimed to be behind them.

BBC security correspondent Frank Gardner said a previously unknown group calling itself the Secret Organisation Group of al-Qaeda of Jihad Organisation in Europe had claimed to be behind the attacks in a statement posted on an Islamist website.

The group's statement said the attacks were revenge for the "massacres" Britain was committing in Iraq and Afghanistan and that the country was now "burning with fear and panic", he added.

Early reports had suggested a power surge could be to blame for explosions on the Underground but this was later discounted.

Describing the bus blast in Tavistock Square, witness Belinda Seabrook said she saw an explosion rip through the vehicle.

"I was on the bus in front and heard an incredible bang, I turned round and half the double-decker bus was in the air," she said.

She said the bus had been travelling from Euston to Russell Square and was "packed" with people turned away from Tube stops.

"It was a massive explosion and there were papers and half a bus flying through the air." she said.

One caller to BBC Five Live said his friend had seen "the bus ripped open like a can of sardines".

Xangans, today is a somber day. We mourn for the loss of life and for the dispicable acts that led to it. Let us hope that in spite of the horror, the Prime Minister will not follow the path of the US President.