New York City police say a man had an explosive device strapped on when it detonated while he was underground in the subway.
It was a pipe bomb, attached by velcro and zip ties, but FBI bomb technicians and police officers are investigating further.
The device went off in a corridor connecting the Times Square and Port Authority stations on the city's west side, one of the busiest commuter hubs, at 7:30am during the morning rush.
At least four people total also suffered non-life threatening injuries such as ringing in ears, headaches, and scrapes according to police officials.
US President Donald Trump has been briefed on the situation, according to Press Secretary Sarah Huckabee Sanders.
The bus terminal at Port Authority had been evacuated and closed, but reopened just before 10am.
Police sources told CBS News, the suspect is believed to be a man from Bangladesh who has been living in the US for several years.
Police officials have confirmed he is 27-year-old Akayed Ullah. Surveillance video of the incident is being reviewed.
Police Commissioner Paul O'Neill said the suspect "made statements" regarding terror group Isis but declined to comment further.
He had a homemade device that either did not fully detonate or malfunctioned in some way, resulting in burns to his hands and abdomen as well as lacerations.
Investigators are looking into the alleged attacker's residence and personal life at this time.
New York Governor Andrew Cuomo said during a news conference that the "reality turned out better than initial expectation and fear" of a bomb going off on the subway.
He commended first responders and said there were "minor" injuries from the "essentially low tech" explosive device.
"This is New York, we all stick together. We're a savvy people. That's what 'see something, say something' is all about," said the Governor, adding that New Yorkers should not let this disrupt them because "that's exactly what [attackers] want."
New York Mayor Bill de Blasio said "New York is a target for a reason," because of its diversity and representation of "democracy"
He also said it was an "attempted terrorist attack" and that there are "no credible and specific threats against New York City at this time."
"Let's get back to work," the mayor said.
Transportation authorities have said the subway system on the 8th Avenue lines and the cross-town train to Grand Central station, another major commuting hub, should be fully operational by the evening rush hour.
The incident occurred less than two months after Uzbek immigrant Sayfullo Saipov killed eight people by speeding a rental truck down a New York City bike path close to the World Trade Center memorial before being shot by police. Isis claimed responsibility for the New Jersey resident's actions.
In September 2016, a man injured more than two dozen people when he set off a homemade bomb in New York's Chelsea district.