At least 22 people, including some children, have been killed and 59 wounded when a suicide bomber struck as thousands of fans streamed out of a concert by US popstar Ariana Grande in the British city of Manchester.

Key points: Man detonated improvised explosive device at concert, police say

Man detonated improvised explosive device at concert, police say Authorities working to learn if man acted alone or was part of group

Authorities working to learn if man acted alone or was part of group Children among 22 confirmed dead

Police said the man used an improvised explosive device and died in the attack. They would not reveal if he was a British national, and said they were investigating whether other people were involved in planning or carrying out the attack.

They confirmed children were among the dead and those injured were being treated in eight different hospitals.

US pop singer Ariana Grande had just finished performing at Manchester Arena to an audience that included many teenagers and children when there was an explosion at the venue.

Video posted on Twitter showed hundreds of fans fleeing after the concert, while a witness said she "felt the blast in her chest".

"We were making our way out and when we were right by the door there was a massive explosion and everybody was screaming," witness Catherine Macfarlane said.

Police escort an injured woman outside Manchester Arena after the explosion. ( Supplied: Goodman/LNP/Rex/Shutterstock )

Other concertgoers said they heard "one or two loud bangs" at the end of the concert as the lights were coming back on.

Earlier reports said the explosion had happened in the foyer about 10:30pm (local time) but a statement from Manchester Arena said the incident took place "outside the venue".

Residents living nearby said the bangs were loud enough to shake their apartment.

The Department of Foreign Affairs said the Australian High Commission in London was making urgent enquiries to determine if any Australians had been involved in the incident.

British Prime Minister Theresa May said police were working to establish the full details of the incident, which was being treated as "an appalling terrorist attack".

She will hold a meeting of the country's top security committee later today.

Chief Constable Ian Hopkins from Greater Manchester Police said police were working closely with the national counter-terrorism policing network and UK intelligence partners.

Sorry, this video has expired Panic at Manchester's Victoria Station

"The priority is to establish whether [the terrorist] was acting alone or as part of a network," he said.

"The attacker … died at the arena. We believe the attacker was carrying an improvised explosive device which he detonated, causing this atrocity."

The terrorist attack is the deadliest incident in Britain since four suicide bombers killed 52 people on London's transport system in July 2005.

Islamic State has not formally claimed responsibility for the incident, but supporters of the group have taken to social media to "celebrate" the incident, with some users encouraging similar attacks elsewhere.

"It seems that bombs of the British airforce over children of Mosul and Raqqa has just came back to #Manchester," one user named Abdul Haqq said on Twitter, in reference to the Iraqi and Syrian cities where a US-led coalition is conducting air strikes.

In Federal Parliament, Prime Minister Malcolm Turnbull described it as a "brutal attack on young people everywhere, on freedom everywhere".

This incident, this attack, is especially vile, especially criminal, especially horrific because it appears to have been deliberately directed at teenagers," he said.

"This is an attack on innocence."

He extended Australia's "heartfelt sympathy and resolute solidarity" to the people of the United Kingdom.

United States President Donald Trump said the US stood in "absolute solidarity" with the British people and said those behind the attack were "evil losers".

"So many young, beautiful innocent people living and enjoying their lives murdered by evil losers in life," he said after talks with Palestinian President Mahmoud Abbas in Bethlehem.

Map Map showing location of Manchester Arena

Witnesses saw people covered in blood, others on ground

Fans cry as they leave a hotel in central Manchester the morning after the attack. ( AP: Rui Vieira )

Witness Harry Johnson told a local radio station that when people heard the explosions, they ducked for cover as fast as possible.

"People were just looking around and no-one really knew what to do. Then there was just screaming and shouting," he said.

Mr Johnson said as chaos ensued, people had difficulty trying to exit the venue through the stairwells.

"There was no space between anyone. Everyone was squished together trying to get out. It took around a minute to get out."

Sorry, this video has expired People flee concert venue after 'explosion' at Manchester Arena

Local man David Richardson was at the concert with his 13-year-old daughter Emily.

"The lights came on after the gig and people were starting to leave. As I turned to the left there was an explosion," Mr Richardson told Manchester Evening News.

"It was about 40 foot behind us near one of the exits. We just thought it was people messing about … then it happened again.

"Then we saw the smoke. Everyone just fled… we saw blood on people when we got outside — people were just running all over the place."

Two women wrapped in thermal blankets stand near the Manchester Arena. ( Reuters: Andrew Yates )

Another witness described to BBC radio in Manchester how she and her 12-year-old sister tried to escape the arena.

"You could see people running down the stairs and I grabbed my sister's head and I ducked her underneath the chairs because I could see hundreds and hundreds of girls running … and there was no way for us to get out," she said.

"I rang my boyfriend who was parked nearby and I said, 'I don't know whether to get out. I don't know what to do.'

"He said: 'Try and get out as quick as you can'. We scrambled to get back out. We got into the foyer and there was smoke everywhere and it smelt of dirty — I can't describe it. I don't know what it was.

"When we finally got out, there were people lying everywhere and they had bandages on their heads and my 12-year-old sister grabbed onto me and said, 'I love you' … it was horrible."

Another eyewitness told the BBC he saw families separated in the chaos.

"I just saw everybody running out the exits," he said. "I picked up a lady who said she was looking to her grandkids.

"She picked up a young girl off the floor who was covered in blood, her parents were laying next to her."

Sorry, this video has expired Police cordon off street outside Manchester Arena

'I thought I was going to die'

Sorry, this video has expired Concertgoers panic as loud bang heard in Manchester Arena

Manchester woman Nicole, 22, spoke to triple j's Hack program after she returned home safely from the concert.

"I literally thought I was going to die," she said.

"I just wanted to get out of there. I was crying, I was really upset, I just wanted to get out."

Nicole said it took her about 15 minutes to exit the venue through the crush, and she did not personally see anyone injured around her.

"I kind of had an idea of what had went on, but then when I got outside I realised … there was police and everything else outside.

"And seeing little kids and stuff crying … it wasn't nice to see."

Frantic loved ones of concert-goers still missing after the incident have taken to social media to post photos of those missing and plead for help to find them.

Many Manchester residents have also used social media to offer shelter or transport to those in need.

A spokesman for Grande said the performer was not hurt in the incident.

Britain is on its second-highest alert level of "severe" meaning an attack by militants is considered highly likely. ( AP: Peter Byrne )

The 23-year-old singer, who started her career as a star on a Nickelodeon TV series, is on an international tour supporting her 2016 album Dangerous Woman.

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The tour was scheduled to continue on Thursday at the O2 Arena in London.

Manchester Arena is the largest indoor arena in Europe, with a capacity of 21,000 — but it is not yet known how many people attended the concert.

The arena foyer connects with the city's Victoria train and tram station, a major hub on the northern edge of Manchester.

A centre has been set up in one of the local hotels where about 50 children have been taken in, as people try to reconnect them with their families.

Police are also in the process of setting up a casualty bureau, while people are using the hashtag #roomformanchester on social media, offering their homes to those who need help after the incident.

Britain is on its second-highest alert level of "severe" meaning an attack by militants is considered highly likely.

Sorry, this video has expired Ambulances respond to Manchester incident

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