Emergency legislation is to be introduced to end the automatic early release from prison of terror offenders.
Justice Secretary Robert Buckland told MPs the change would apply to both current and future offenders.
Terror offenders will only be considered for release once they have served two-thirds of their sentence and with the approval of the Parole Board.
It follows two attacks by men convicted of terror offences in recent months. On Sunday, Sudesh Amman, 20, was shot dead by police in Streatham, south London, after stabbing two people. And in November two people were killed near London Bridge.
Mr Buckland said the latest attack made the case “for immediate action.”
“We cannot have the situation, as we saw tragically in yesterday’s case, where an offender – a known risk to innocent members of the public – is released early by automatic process of law without any oversight by the Parole Board,” he said.
Meanwhile, the mother of Sudesh Amman has told Sky News he was a “nice, polite boy” who was radicalised online and in prison.
Haleema Faraz Khan said her son seemed “normal” when she visited him at a bail hostel on Thursday and he called her before Sunday’s attack asking her to make him some mutton biryani.
Amman was under police surveillance when he stabbed two people in south London while wearing a fake suicide vest before he was shot dead by officers.
The 20-year-old from Harrow, northwest London, had been released from prison in January after serving time for spreading extremist material.
In an interview with Sky News, Ms Khan said she could not believe her “polite and lovely boy” who was “always smiling” could carry out a terror attack.
Fighting back tears, she said she believed her son had become radicalised after watching “Islamist” material online and while in the high security jail Belmarsh.
“I spoke to him on the phone on Sunday,” Ms Khan said. “He said: ‘Mum I want some biryani…. your mutton biryani’. He was fine when I went to see him. He became more religious inside prison, that’s where I think he became radicalised.
“He was watching and listening to things online which brainwashed him. Before he went to prison he was not that religious. After he came out he was really religious.”
Following his release from prison, he had been staying at a bail hostel in Streatham for the past two weeks after serving less than half of his sentence.
The Ministry of Justice has refused to reveal the date Amman was released but confirmed it was “in the past six weeks”.
About 245 convicted terrorists were freed from jail between 2012 and 2019.
London Mayor Sadiq Khan said more than 70 people who have been convicted of a terrorist offence and served time in prison have been released in the capital.