Senior security sources warned that the risk to the country was nearing "critical" from the current "severe", according to 'The Sunday Times'.
Ministers ordered border staff to step up the search for illegal firearms after security chiefs warned that up to half the jihadists who had returned from Syria were capable of assaults like those on the satirical magazine 'Charlie Hebdo' and a kosher supermarket, in which 17 people died.
UK government sources told the newspaper that more than 30 Islamic State (IS) fighters in the UK have been placed under surveillance by the MI5 security service because they are considered a serious threat.
Since 2006, when the threat level was first made public, it has twice been raised to critical, once in August 2006 after police exposed a plot to smuggle explosives on to transatlantic jets and again in June 2007 after a terrorist attack on Glasgow airport.
More From This Section
There is concern that Britain's transport infrastructure is vulnerable.
Fears of an airline bomb attack have also been fuelled by an online guide to building a "hidden bomb" released by Al Qaeda which claims is not detectable by airport security systems.
He claimed three major plots had already been thwarted.
Five men were charged last October in connection with an alleged plot to shoot police and soldiers on the streets.