Armed police stormed the platform at Bank station after receiving reports of a "man with a knife".
Large parts of the Central line was closed and trains halted at Bank and Liverpool Street stations while a search was carried out.
Commuters said they were "terrified" as armed police "charged down the platform" at Bank station.
The British Transport Police said: "We were made aware at 5.11pm today (14 December) of a report about a man with a knife at Bank station."
The Central line was suspended between Leytonstone in east London and White City in west London while the incident was investigated.
The police said no trace of the man has been found but enquiries are ongoing and officers are still on the scene.
Commuters have posted pictures on social media of the chaos caused at train stations after the line was shut.
Service is understood to have resumed on the Central line.