The bomb was an elaborate fake supplied by the agents and the public was never in danger, authorities said.
Mohamed Osman Mohamud, 19, was arrested at 5:40 p.m. Friday just after he dialed a cell phone that he thought would set off the blast but instead brought federal agents and police swooping down on him.
Yelling "Allahu akbar!" -- Arabic for "God is great!" -- Mohamud tried to kick agents and police after he was arrested, according to prosecutors.
"The threat was very real," said Arthur Balizan, special agent in charge of the FBI in Oregon. "Our investigation shows that Mohamud was absolutely committed to carrying out an attack on a very grand scale."
(Torsten Kjellstrand ~ The Oregonian)
"The events of the past 24 hours underscore the necessity of remaining vigilant against terrorism here and abroad," Shapiro said.
A law enforcement official, who was not authorized to discuss the investigation publicly and spoke on condition of anonymity, said that federal agents began investigating the suspect after receiving a tip from someone who was concerned about the teenager. The official declined to provide more detail about the relationship between Mohamud and that source.
The FBI affidavit that outlined the investigation alleges that Mohamud planned the attack for months, at one point mailing bomb components to FBI operatives, whom he believed were assembling the device.
According to the official, Mohamud hatched the plan on his own and without any instruction from a foreign terrorist organization, and he planned the details, including where to park the van for the maximum number of casualties.
The affidavit said Mohamud was warned several times about the seriousness of his plan, that women and children could be killed, and that he could back out, but he told agents: "Since I was 15 I thought about all this;" and "It's going to be a fireworks show ... a spectacular show."
Mohamud, a naturalized U.S. citizen living in Corvallis, Ore., was charged with attempted use of a weapon of mass destruction, which carries a maximum sentence of life in prison. A court appearance was set for Monday.
Authorities allowed the plot to proceed in order to build up enough evidence to charge the suspect with attempt.
The alleged plot in Portland follows a string of terrorist attack planning by U.S. citizens or residents, including a Times Square plot in which Faisal Shahzad pleaded guilty to trying to set off a car bomb at a bustling street corner. U.S. authorities had no intelligence about Shahzad's plot until the smoking car turned up in Manhattan.
Late last month, Farooque Ahmed, 34, of Virginia was arrested and accused of casing Washington-area subway stations in what he thought was an al-Qaida plot to bomb and kill commuters. Similar to the Portland sting, the bombing plot was a ruse conducted over the past six months by federal officials.
U.S. Attorney Dwight Holton released federal court documents to The Associated Press and the Oregonian newspaper that show the sting operation began in June after an undercover agent learned that Mohamud had been in regular e-mail contact with an "unindicted associate" in Pakistan's northwest, a frontier region where al-Qaida and Afghanistan's Taliban insurgents are strong. The person Mohamud had been in e-mail contact with was a friend living in Pakistan who had been a student in Oregon in 2007-2008, the official told the AP.
The two used coded language in which the FBI believes Mohamud discussed traveling to Pakistan to prepare for "violent jihad," the documents said.
In June an FBI agent contacted Mohamud "under the guise of being affiliated with" the suspected terrorist.
An undercover agent met with him a month later in Portland, where they "discussed violent jihad," according to the court documents.
As a trial run, Mohamud and agents detonated a bomb in Oregon's backcountry earlier this month.
"This defendant's chilling determination is a stark reminder that there are people -- even here in Oregon -- who are determined to kill Americans," Holton said.
Friday, an agent and Mohamud drove to downtown Portland in a white van that carried six 55-gallon drums with detonation cords and plastic caps, but all of them were inert, the complaint states.
They left the van near the downtown ceremony site and went to a train station where Mohamud was given a cell phone that he thought would blow up the vehicle, according to the complaint. There was no detonation when he dialed, and when he tried again federal agents and police made their move.
Omar Jamal, first secretary to the Somali mission to the United Nations, condemned the plot and urged Somalis to cooperate with police and the FBI.
"Talk to them and tell them what you know so we can all be safe," Jamal said.
Somalia Foreign Minister Mohamed Abullahi Omaar said his government is "ready and willing" to offer the U.S. any assistance it may need to prevent similar attempts. He said the attempt in Portland was a tragedy for Mohamud's family and the "people he tried to harm."
"Mohamud's attempt is neither representative nor an example of Somalis. Somalis are peace loving people," said Omaar, whose government is holed up in a few blocks of the capital, Mogadishu, while much of the country's southern and central regions are ruled by Islamist insurgents.
Tens of thousands of Somalis have resettled in the United States since their country plunged into lawlessness in 1991, and the U.S. has boosted aid to the country.
In August, the U.S. Justice Department unsealed an indictment naming 14 people accused of being a deadly pipeline routing money and fighters from the U.S. to al-Shabab, an al-Qaida affiliated group in Mohamud's native Somalia,
At the time, Attorney General Eric Holder said the indictments reflect a disturbing trend of recruitment efforts targeting U.S. residents to become terrorists.
Officials have been working with Muslim community leaders across the United States, particularly in Somali diasporas in Minnesota, trying to combat the radicalization.