New laws in the Republic of Ireland are being rushed in ahead of the G8 summit to allow gardai to order telecom companies to shut off signals to prevent terrorists using mobile phones to detonate bombs.
He said it was possible a terrorist group would use the G8 as a chance to "garner publicity" for themselves by setting off a bomb.
Mr Shatter said the Boston bombing was a recent example of the use of mobile phones by terrorists to detonate bombs.
Up until now, it is understood gardai could only request mobile companies as a goodwill gesture to block the mobile phone signal in an area to protect VIPs.
Coalition sources indicated gardai have gone down this route before in limited circumstances. But Mr Shatter will put the process on a legislative footing, setting out clear guidelines where senior gardai can make the request and obliging the mobile phones providers to abide by the order.
Mr Shatter warned that there was a "real danger" lives could be lost in such an event. "It is possible that terrorist groups may try to use the occasion of the summit to, at the very least, garner publicity for themselves," he said.
The measure will be included as an amendment to the Money Laundering and Terrorist Financing Bill.
Mr Shatter said the summit created a real necessity for legislation to give the Irish government the power to ask phone companies to cut or limit signals.
"The provision will contain safeguards to ensure that any interference to services is limited to the extent necessary to deal with the threat," he said.
Also yesterday, it emerged a major public march and rally will be held in Belfast the weekend before the G8 summit.
Unions and campaign groups like Amnesty International and Friends of the Earth are organising a Fairer World Festival to coincide with the event.