Manhattan's Port Authority Bus Terminal has reportedly been hit by a pipe bomb which exploded in an underground passageway.
Frightened tourists were reportedly "stampeding" from the scene after the blast.
And terrifying footage shows panic-stricken New Yorkers fleeing as emergency services rush to calm the situation.
The New York Police Department confirmed a major evacuation took place, later adding that a man had an explosive device strapped on when it detonated.
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The New York Fire Department rushed to the scene along with the bomb squad.
US President Donald Trump has been briefed on the incident, White House Press Secretary Sarah Sanders said in a tweet.
One woman wrote on Twitter: "Just was stuck in a running stampede at port authority bus terminal due to bomb scare."
In Pictures: Bomb explodes at New York's main bus station
An NYPD statement reads: "Update regarding explosion at 42nd St and 8th Ave, in subway: One male suspect is in custody.
"No injuries other than suspect at this time. Avoid the area.
"Subways bypassing #PortAuthority and Times Square Stations. Info is preliminary."