Swedish Police is suspecting that the man arrested in connection with the attack on a crowd of people in central Stockholm, to be the driver of the truck.
At least four people were killed in the incident.
The man in custody, whose appearance matches the description of a person of interest, is being held on "suspicion of terrorist crimes through murder," CNN quoted Karin Rosander, spokeswoman for Sweden's prosecutor's office, as saying.
The Swedish Security Service said that an arrest was made after the attack, which happened just before 3 p.m. local time.
Earlier, Anders Thornberg, Director General of the Swedish Security Service, said that a "person of interest" was being investigated and authorities released a photo of him.
Prime Minister Stefan Lofven said the incident appeared to be a 'terror attack'.
He told reporters during a visit to western Sweden that, "Sweden has been attacked. Everything points to the fact that this is a terrorist attack."
Four people were killed after after a lorry rammed into a crowd of people in central Stockholm on Friday, which is few meters away from Indian Embassy.
Speaking to ANI, Indian Ambassador to Sweden Monika Mohta, said, "I heard loud noises and saw two people lying on the street."
She also informed that rail services have been temporarily halted and the House of Culture has been shut down.
Another eyewitness, who was present near the spot when the incident took place said, "I was in a nearby store in Drottninggatan Street when I heard women speaking in very high tone."
"When I went outside, I saw some people were screaming when the attack happened. I asked a lady, she said that a truck has hit people and is running people down and then there was a lot of chaos.
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