Riots and looting spread widely across England on Tuesday, with police waging running battles with gangs in Greater Manchester, the West Midlands and Nottingham, even as the biggest police deployment in UK history appeared to have at least temporarily quelled further significant trouble in London.

Following widespread chaos in the capital throughout Monday night, described by Scotland Yard as the worst UK urban violence in living memory, a newly-returned David Cameron ordered 16,000 police onto the city's streets, also granting officers the option of using plastic bullets, which have never been previously fired on the British mainland.

Amid intense pressure on police resources the military were taking an increased – though still indirect – role. Some of the 1,500 officers drafted into London from elsewhere were housed at army barracks, and Essex police used some army vehicles as backup transport.

The tough tactics had at least a temporary impact, with little trouble reported in London. Large parts of the city nonetheless remained in virtual lockdown, with thousands of shops and businesses closing early and some boarding up windows.

In contrast, groups of masked and hooded rioters looted dozens of shops in Manchester and adjoining Salford, consistently evading riot officers and setting shops on fire. Greater Manchester police admitted they had struggled to regain control of some streets from "criminals running wild", calling it the worst unrest in the city for 30 years.

There was sporadic but long-running trouble in Birmingham, Wolverhampton and West Bromwich, while a police station in Nottingham was firebombed by a gang of dozens of men.

Later, there were reports that a gun was discharged towards officers in Aston, Birmingham. West Midlands police said an officer, in an area not previously connected to the rioting, heard what he thought was a shot fired. They immediately dispatched a firearms team to the scene.

Beginning a day of drama, David Cameron, stood in Downing Street hours after returning from holiday and pledged to flood the capital with more than double the number of police.

The public should expect to see "many more" rioters arrested from now on, the prime minister said. Parliament would be recalled on Thursday to debate the trouble, he added. Shortly afterwards Cameron chaired a meeting of the Cobra security committee at which it is understood he and the home secretary, Theresa May, discussed the possible use of plastic bullets, water cannon and other tactics.

Any decision on using plastic bullets will be up to senior police officers. If used, it would be the first time they have been fired at rioters in the UK outside Northern Ireland. It forms part of a wider reversal of tactics by Scotland Yard after criticism of its response so far. Senior police sources told the Guardian on Tuesday that for the first three nights of trouble officers in London were told to stand by, watch and wait rather than actively seek to arrest rioters and looters. But after anger from the public – who witnessed officers seemingly doing little as youths ran unchecked, burning and looting– and Cameron's intervention, those orders were changed to leave officers free to tackle troublemakers.

The Met's acting commissioner, Tim Godwin, and his senior team authorised the tougher tactics after watching Monday night's events from their operations centre. In the early hours of Tuesday, the decision to use heavily armoured Jankel vehicles to clear the streets of Clapham Junction, south London, was the first indication of a radical change of plan.

"The officers on the streets wanted to do nothing more than go in and arrest people as they were in the act of breaking into property, looting and robbing. But they had been told not to and it was just not acceptable," said a source. "That has had to change."

A parallel crackdown has begun to track down rioters and looters, with police releasing a gallery of those believed responsible for trouble, including CCTV stills of very young men and women, some with faces clearly visible. So far, Scotland Yard officers have arrested 685 people, with 105 charged. In total, 111 officers and five police dogs, have been injured.

Monday's trouble saw the first confirmed death, when a 26-year-old man was shot in the head in Croydon.

Police investigating a large fire which destroyed the House of Reeves furniture store in Croydon on Monday night have arrested a 21-year-old man on suspicion of arson with intent to endanger life, Scotland Yard said.

Another man is fighting for his life after being attacked by rioters in Ealing, west London. "Where will this end?" said Jalil al-Mohammed, whose Croydon greengrocers shop was looted. "This boy has died and all these shops have gone. It affects everybody not just the shop owners."

The chaos has brought a series of knock-on effects, including the cancellation of Wednesday's football friendly between England and the Netherlands at Wembley. This weekend's start of the Premier League season is also in doubt, with several fixtures in the capital under threat.

The scale of the trouble brought other politicians back to London along with Cameron. Also newly returned were Nick Clegg and the London mayor, Boris Johnson, both of whom endured a sometimes hostile reception on walkabouts. Clegg was booed by a crowd in Birmingham while Johnson, in Clapham Junction, saw an off-the-cuff speech interrupted by cries of "Where were the police?"

The first rioting began on Saturday in the wake of a protest in Tottenham, north London, following the fatal shooting by police of a local man, Mark Duggan, two days earlier. On Tuesday the Independent Police Complaints Commission confirmed that initial ballistics tests suggested Duggan had not opened fire on the police before he was killed, although the illegal firearm he was carrying was loaded. The IPCC said Duggan suffered gunshot wounds to his chest and right arm.

The rioting could cost taxpayers £100m, according to the Association of British Insurers, with police authorities having to pick up insurance costs. The Riots (Damages) Act 1886 specifies that if damage is caused by people "riotously and tumultuously assembled", local police authorities are required to compensate victims.