Indonesia's anti-terror squad has arrested 11 people suspected of planning a range of attacks on domestic and foreign targets including the US embassy and a site near the Australian embassy.
The suspects were arrested in raids Friday and Saturday in four provinces, national police spokesman Suhardi Alius said.
He said the suspects belonged to a new group called the Harakah Sunni for Indonesian Society, or HASMI.
"From evidence found at the scene, we believe that this group was well prepared for serious terror attacks," Alius said.
Police seized a number of bombs, explosive materials, a bomb-making manual and ammunition, Alius said. They also found a 3kg gas cylinder filled with highly explosive material, which had been assembled at a house in the East Java town of Madiun.
Videos and images of attacks on Muslims in various parts of the world were also recovered, he said.
Alius said the group planned to target the US embassy in Jakarta and a plaza near the Australian embassy and the local office of US mining giant Freeport-McMoRan.
It also planned to attack the US consulate in Surabaya and the headquarters of a special police force in Central Java, he said.
It was unclear how far the plans had advanced.
Alius said police are still investigating whether the group has ties with established militant groups such as Jemaah Islamiyah.
An investigator who spoke in condition of anonymity because he was not authorised to provide information to the media said HASMI's apparent leader, Abu Hanifah, was a Jemaah Islamiyah sympathiser.
Indonesia, the world's most populous Muslim-majority nation, has been battling militants since the 2002 bombings in Bali by a group linked to Jemaah Islamiyah which killed 202 people, mostly foreign tourists.
Subsequent attacks have claimed more than 50 people, mostly Indonesians. The government has arrested more than 700 suspected militants and killed dozens more in an attempt to root out militants.
Earlier this month, police warned of a threat in Bali targeting a ceremony commemorating the 10th anniversary of the bombings. The country's security alert was raised to its highest level.
Last month, police arrested 10 militants and seized a dozen homemade bombs from a group suspected of planning suicide attacks against security forces and plotting to blow up the Parliament building. The alleged bomb maker turned himself in to police while wearing an empty suicide vest.
Recent attacks in the country have been carried out by individuals or small groups and have targeted security forces and local "infidels" instead of Westerners, with less deadly results.
The arrests announced Saturday appear to be the first in recent years to involve a group that allegedly planned to target foreign facilities.