The Home Secretary will have greater freedom to exclude and deport foreigners preaching hate and violence. And ministers were also looking at strengthening powers to deal with home-grown fanatics, Mr Blair announced.
If necessary MPs will be recalled from their lengthy summer break and the UK could renounce parts of the European Convention on Human Rights, the Prime Minister pledged.
"Coming to Britain is not a right and even when people have come here staying here carries with it a duty," he said. "That duty is to share and support the values that sustain the British way of life.
"Those that break that duty and try and incited or engage in violence against our country or our people have no place here."
At a pre-holiday press conference in Downing Street, Mr Blair outlined
wide-ranging action in 12 areas.
The key was dealing with the foreign extremists who provide the " ideological drive" for British fanatics like the London suicide bombers, Mr Blair said.
Clerics coming in to preach at British mosques will have to be vetted to ensure they do not pose a threat while those already here will be deported, the Prime Minister said.
British courts have previously refused to return anyone who faces the threat of torture or death in their home country.
The Government was now working on agreements with 10 such countries so they can be sent back.
The Government will repeatedly test the new arrangements in the courts but if problems remained then Britain's interpretation of the convention could be changed, he pledged.
Such a revision has been called for by Conservatives but will be opposed by human rights activists.
"Anybody who is a foreign national who is inciting or engaging in extremism in this country should be out," Mr Blair said.
Mr Blair said opposition to earlier anti-terror measures showed he would have had no chance of getting the new proposals through before the July 7 attack.
However, the national mood had now changed, the Prime Minister said.
"Most people recognise the climate in which these measures are being taken is somewhat different," he said.
"People can't come here and abuse our good nature and our tolerance, come here and start inciting our young people into violence."
Mr Blair's wife Cherie, a leading human rights lawyer, recently warned the Government should not be provoked into interfering with the independence of the courts.
The Prime Minister insisted that the right to life and freedom from terror was a basic human right.
"I have never accepted this idea that there is a choice between the concept of human rights and the concept of protecting the country from terrorism," he said.
"People have a right to be protected from terrorism."
Mr Blair went out of his way to repeatedly stress that the measures were aimed at extremists, not ordinary Muslims.
"This is not in any sense aimed at the decent, law-abiding Muslim community of Britain," he said.
"We know this fringe does not truly represent Islam. We know British Muslims in general abhor the actions of the extremists."
The Liberal Democrat leader Charles Kennedy warned that the proposals threaten the political consensus created by the bombings.
"The public mood has certainly shifted on the question of whether we should allow foreign nationals who incite violence to enter or stay in the UK," he said.
"However, today's list of announcements has put the cross-party consensus under serious strain.
"The Government agreed to properly consult opposition parties on their proposals, but this agreement seems to have broken down.
"No mention was made of the proposals during a briefing the Liberal Democrats received from the Home Office yesterday, and it appears that even they may not have been aware of the Prime Minister's plans."
Banning Muslim organisations, closing mosques and deporting people who visit certain bookshops or websites risks "inflaming tensions", Mr Kennedy said.
The measures could mean "alienating Muslims at the very time we need the different communities of Britain to pull together".
"The Liberal Democrats will examine the detail of these measures, but the Prime Minister should not count on our support," he said.
"We shall reserve our position until we have consulted properly ourselves - albeit against a constrained August timetable."
On Mr Blair's indication that the Human Rights Act could be amended, Eric Metcalfe of human rights group Justice said: "A British court would never accept a diplomatic assurance from a country that tortures its own citizens.
"Any attempt to amend the Human Rights Act to force courts to do otherwise is doomed to failure.
"A free society doesn't fight terrorists by exporting them to other countries. It prosecutes them here in the UK."
- More about:
- Human Rights