The games are being planned on the assumption that the threat will be “substantial” rather than the current level of “severe.”

Speaking at the conference at the Royal United Services Institute in London, Lord West said: “The London 2012 Olympic and Paralympic Games promise to be the greatest sporting event in UK history and quite possibly the greatest security challenge that the UK has faced since the Second World War.”

But the conference also heard from Sir Ian Johnston, director of security and resilience for the London Organising Committee, who said there would not be “blanket coverage” and security would be based on “an assessment of risk at the different venues at different times.”

Philip Graham, deputy director of threats and operations support at the Department of Transport body Transec, said they were still assessing the threats to public transport and that security plans would not be operational until April 2012.

Lord West reminded the conference on Olympic security that the July 7 terrorist attacks took place the day after Britain won its bid to stage the Olympics in 2012.

He added: “Since that tragic event the UK has continued to face a high level of threat from terrorism. We expect this threat to remain come the summer of 2012.”

The minister said the threat had evolved with the recent terrorist attacks against hotels in Mumbai, India and the Sri Lankan cricket team in Lahore, Pakistan and added that those attacks “provide a sober illustration of the terrorists’ ability to use different methods and tactics.”

Lord West said they expected to sell nine million tickets and that 15,000 athletes from over 200 countries would be competing at over 30 venues, accompanied by around 14,000 coaches and officials and 20,000 members of the media, all taking place alongside celebrations for the Queen’s Diamond Jubilee.

The security operation is costing £600 million but Lord West said it would have to balance risks against the need to have the games run smoothly.

“The Olympics and Paralympics are about sports not security,” the minister said. “We want the world to be inspired by the incredible sporting spectacle taking place here in London, one of the world’s greatest cities.

“Our security plans therefore need to strike a balance between visible and effective security and the welcoming and friendly atmosphere we all want.”