The men, aged 35, 30, 24, 23 and 21, were arrested "on suspicion of the commission, preparation or instigation of acts of terrorism," Scotland Yard police headquarters said.
They were arrested at five residential addresses in Luton and were taken to a central London police station where they remain in custody.
The arrests by officers from the Counter-Terrorism Command were a part of a pre-planned, intelligence-led operation, Scotland Yard said.
The men were arrested at houses in the Bury Park area, which has been home to a large Muslim Pakistani community since the 1970s. It is also home to Luton Central Mosque, one of the first purpose-built mosques in Britain.
The local Bedfordshire Police force said the arrests were made by unarmed officers.
"Full consideration has been given to treating those arrested, and especially their families, with appropriate respect for cultural and religious identity as far as is possible," a spokeswoman said.
Searches are being carried out at the five houses and are expected to take at least a day. The families of those arrested have been advised to find alternative accommodation.
"There is no danger to other nearby residents," the spokeswoman said.
Around 15 percent of the population of nearly 200,000 are Muslim.
Taimour Abdulwahab, who carried out Sweden's first ever suicide attack when he activated a bomb in Stockholm in December 2010, was thought to have been radicalised in the commuter town.
Abdulwahab lived with his wife and three children in Luton after completing a sports psychology degree in the town.
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@shazada zahid mahmoud malik loan:
Sadly, we have quite a few delusional individuals in UK, just like yourself.
If they were living in UK since 1970, they are no more Pakistanis.
@shazada zahid mahmoud malik loan, Yes I found your reasoning rather bizarre, Imagine a situation where you invite your friends or relatives to stay with you. How would you feel if they do not adapt to your ways of living and start imposing their views and lifestyles on you. Same here, when in Rome, Live and Do as a Roman Does. Besides if you cannot stand their "Discrimination" you can always come back to your Mother Land. No body is holding your back from returning untill or unless you are an absconder from law. Rgds Pr
@shazada zahid mahmoud malik loan: If you dont like living in and enjoying this Christian country you are welcome to depart to the land of the pure.
@check: Dream on mate
@shazada zahid mahmoud malik loan: let PTI come to power....let corruption be rooted out in Pakistan...you will see "goras" lining up in queues to get Pakistani visa and citizenship in 2020s......!!! all Lutonites will come back to become entrepreneurs or investors in Pakistan....
@shazada zahid mahmoud malik loan: "I find it rather bizarre that the police carried out those raids"
Did you find the 7/11 London bombings bizarre too? Maybe you think that the white Christian fundamentalist did that too.
Pakistan in trouble...again!