response to events in Iraq and Syria, where ISIS militants have seized a swath of territory.
"That means that a terrorist attack is highly likely, but there is no intelligence to suggest that an attack is imminent," Home Secretary Theresa May said.
The U.S. Department of Homeland Security, meanwhile, said it is not aware of any specific, credible threat to the United States.
British Prime Minister David Cameron said the "root cause" of the terrorist threat in the United Kingdom is "Islamist extremism." He said the recent killing of U.S. journalist James Foley is clear evidence that ISIS's fight in Iraq and Syria "is not some foreign conflict thousands of miles from home that we can hope to ignore."
The danger that ISIS poses now is a "greater and deeper" threat to the UK's security than the country has ever known, Cameron said.
This is in part because ISIS is not simply seeking refuge in a country but ruthlessly seeking its own terrorist state and expanding, he said.
Cameron said he will soon announce plans to stop would-be jihadists from traveling to Syria and Iraq and to make it easier to take their passports away.
Britain also needs to do more to stop current fighters from returning from the Middle East and to deal decisively with those who already have returned, he said.
UK authorities estimate that 500 Britons have gone to Syria and Iraq to fight with Islamist groups.
The Prime Minister warned against having a knee-jerk response to the threat and said a number of tools must be deployed, the military being just one of them.
An intelligent response will involve aid, diplomacy and political influence, too, he said.
A distinction must be made between the religion of Islam and the "poisonous" political ideology of Islamic extremists, he said.
The UK has five levels of terror threat. It had been at "substantial" since July 11, 2011. The level is set by the Joint Terrorism Analysis Center and the Security Service.