Components for a 250lb car bomb were uncovered during a major security operation in County Armagh, a senior police officer has said.
The material was found during police searches
The discovery was made during searches in the Antrim Road area of Lurgan.
Four men, aged 22, 26, 36, and 46, were arrested and are being held under the Terrorism Act.
Superintendent Alan Todd linked the find to dissident republican paramilitaries and said a bomb attack would have been imminent.
"Material of this sort is by its very nature unstable and, therefore, people preparing these things do so with the intent to use it as soon as possible," he said.
"That means a device was being constructed for immediate use, but more importantly, it means that unstable explosive substances, ready for use, were being prepared in what is a busy residential area behind a commercial premises.
"The risk that provides to the local community is very high and we are very happy police have been able to act."
Dissidents republicans are opposed to the Northern Ireland peace process. They have been blamed for a number of attacks and attempted attacks on the security forces over recent years.
Police discovered the bomb parts at a vehicle breaker's yard early on Wednesday.
Three men were arrested at the scene and a fourth was held later.
Bomb disposal officers were at the scene and part of the town was cordoned off for a time while a search operation went on.
Masked men threw rocks at police Land Rovers
The search was believed to have involved dozens of officers and police sniffer dogs and a large amount of material was taken away for further examination.
SDLP assembly member Dolores Kelly said she believed that police had foiled a major attack.
Ulster Unionist assembly member Samuel Gardiner said: "This is an excellent piece of work by the PSNI and serves as a timely reminder that we must normalise society here by getting the assembly working as soon as possible."
Sinn Fein assembly member John O'Dowd said: "This sort of activity does nothing for this community and is an attack on the peace process which is supported by the overwhelming number of people on this island."
Meanwhile, police in riot gear were attacked by youths throwing stones close to the area where the bomb find was made.
The railway line in Lurgan is still closed following Wednesday's operation.