Reports are emerging of up to eight deaths, and a dozen injuries after a suspected terror attack in Manhattan.

It is understood a ute has been driven into a group of approximately 23 people walking along a bike path near the World Trade Center memorial site.

The suspect then hit a school bus and wrecked his truck.

New York police said the driver was shot by officers after leaving the vehicle brandishing a fake gun and shouting "Alahu Akbar".

They said he had been taken into custody.

The suspect reportedly, in a Home Depot rental truck, hopped a curb at West Houston Street and drove south on the West Street bike path on west side of West Side Highway, an official said.

The incident took place at 3.15pm local time, on Halloween.

Josh Groban live tweets

Singer Josh Groban was within earshot of the attack and live tweeted the chaos to his 940,000 followers.

"[!it!] Was half a block from me, didn’t see it but heard 8-10 quick rounds fired off. Be safe with your kids out there," he wrote in one.