An explosion on a London Underground train is being treated as a "terrorist incident", British police said.

The Metropolitan Police said emergency services were called to Parsons Green station in west London at 8.20am local time (07:20 GMT) following reports of a fire on a commuter train.

A bucket wrapped in an insulated bag caught fire on a packed London subway train on Friday, sending commuters stampeding in panic at the height of the morning rush hour. Police said they were investigating it as a "terrorist" attack.

"Deputy Assistant Commissioner Neil Basu, the senior national coordinator for CT policing, has declared it a terrorist incident," the Metropolitan Police said in a statement.

Photos taken inside a District Line train show a white plastic bucket inside a foil-lined shopping bag. Flames and what appear to be wires emerge from the top. London ambulance service said they had sent multiple crews to the Parsons Green station, and 18 people were hospitalised, though none had life-threatening injuries.

London's Metropolitan Police said counterterrorism investigators were at the Parsons Green station, but it was "too early to confirm the cause of the fire, which will be subject to the investigation that is now under way by the Met's Counter Terrorism Command".

London Transport said services were cut along the line amid reports on social media of the station's evacuation.

The Met's Counter Terrorism Command are investigating after the incident at #ParsonsGreen tube station is declared a terrorist incident — Metropolitan Police (@metpoliceuk) September 15, 2017

Al Jazeera's Sonia Gallego, reporting from London, said media accounts suggested that several people were injured, but it was "unclear whether it had to do with the stampede or incident".

"It's rush hour in London, and the stations are filled to the brim with people, so it seems like it was a chaotic scene," she said.

Flames engulfed one carriage and raced along a train on a west London route to Parsons Green, forcing passengers to trample others as they rushed for an exit, a witness told Reuters news agency.

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The man said people were trampled when they fled the train after hearing a whoosh and seeing flames race towards them.

"I just heard a kind of whoosh. I looked up and saw the whole carriage engulfed in flames making its way towards me," he told Reuters news agency.

He said the train was packed with people.

Mayor Sadiq Khan says London "utterly condemns the hideous individuals who attempt to use terror to harm us and destroy our way of life".

Britain's official threat level stands at "severe," the second-highest rung on a five-point scale, meaning an attack is highly likely.

Several attacks

London has been targeted by attackers several times this year, with vehicle attacks near Parliament, on London Bridge and near a mosque in Finsbury Park in north London.

The London Underground itself has been targeted several times in the past, notably in July 2005, when suicide bombers blew themselves up on three subway trains and a bus, killing 52 people and themselves.

Four more bombers tried a similar attack two weeks later, but their devices failed to explode fully.

Last year Damon Smith, a student, left a knapsack filled with explosives and ball bearings on a London subway train. It failed to explode.