Video report by ITV News correspondent Geraint Vincent.
A French soldier opened fire on a machete-wielding man who "ran towards" security forces around the Musée du Louvre.
The man - who Paris prosecutor Francois Molins said was believed to be a 29-year-old Egyptian - was reportedly attempting to enter the museum's underground shop carrying two backpacks.
It is believed the man was an Egyptian resident who came to Paris on a tourist visa on January 26.
Parisian police chief Michel Cadot said the attacker had "run towards" a group of soldiers, shouting "Allahu akhbar" - 'God is great' in Arabic.
The Paris prosecutor said on Friday night that the attacker, who is in a life-threatening condition after being shot by police, was armed with two machetes - one in each hand and both 40 centimetres long.
Following the attack French President Francois Hollande praised the soldiers involved for showing determination and courage while preventing a terrorist attack from being carried out.
He described the situation at the Louvre as totally under control but added that a terrorist threat to France remains.
"This operation undoubtedly prevented an attack whose terrorist nature leaves little doubt," Hollande said at a meeting of EU leaders in Malta.
We are dealing with an attack from an individual who was clearly aggressive and represented a direct threat, and whose comments lead us to believe that he wished to carry out a terrorist incident.
Neither backpack - which sources had originally reported as suitcases - contained explosives, he confirmed.
Benoit Brulon, spokesman for the military force which patrols key sites in the city, said the man attacked the four-strong team after being refused entry with his bags.
They had tried to fight the man off before opening fire, he said.
One of the soldiers suffered minor injuries, and one of the others then have fired back five times, seriously injuring the man, including in the stomach.
Mr Cadot said that a second individual had been detained after being spotted "behaving suspiciously", but that there did not appear to be a link between them and the attack.
Chinese tourist Jiao Liyang was among the 250 people inside the museum at the time, and said they had been told to sit on the ground in a locked room as the area was put on lockdown.
The Interior Ministry said they would be evacuated in small groups as soon as the "necessary precautions" had been taken.
Armed forces have been in place across the French capital to reassure tourists in the city after two major terror attacks in 2015.
US president Donald Trump was quick to paint the attacker as an as "Islamic terrorist" - adding: "Get smart US."
His remarks were met with a barrage of criticism over his public silence on the shooting at a mosque in Quebec, Canada, where six men were killed and 18 others injured.
French culture minister Audrey Azoulay said the museum is to reopen to the public on Saturday.