The arrests were made after raids in the south of the city. One man was arrested at an address in Clapham and another man was arrested when two addresses were raided in Stockwell. The men are being held at a central London police station.
At Crossford Street, Stockwell, police cordoned off Morell House. Blue tarpaulin covered the entrance to a ground floor flat and was stretched out over a vehicle parked in front.
Ahmet Tokmak, 41, a resiudent, said that police arrived at the block of flats at about 5.30pm. He said: "I had just come in from work. I came upstairs and my daughter started shouting that there were some people with guns outside.
"I went out because my daughter was playing downstairs, but the people started shouting at me to go inside. They were banging on the door and shouting and pushed the door down once it was opened."
Mr Tokmak said the man who lived in the downstairs flat was an Asian man in his late 20s. He lived with his girlfriend and his girlfriend's two children.
Police officers went into the flat and brought the arrested man out about an hour later, he said. He described the man as "nice".
A spokesman for Scotland Yard said: "Two men have been arrested - one at the address in Clapham and another at one of the Stockwell addresses - on suspicion of the commission, preparation or instigation of acts of terrorism."Reuse content