Metropolitan Police commissioner Sir Bernard Hogan-Howe confirmed that there were two deaths, including the pilot named this afternoon as Pete Barnes (50) from Reading. One person was critically injured in the incident and a number of others were left with less serious injuries.
Mr Barnes, who has piloted helicopters in action scenes in movies Die Another Day, Tomb Raider II and Saving Private Ryan, worked for flight operator RotorMotion.
The helicopter spun out of control and crash-landed near Vauxhall station after the pilot attempted to divert the aircraft to a helipad due to bad weather.
The AgustaWestland 109 Power clipped a crane on top of one of Europe's tallest residential towers, falling from the sky before exploding into flames and crashing into the streets below.
Captain Philip Amadeus, managing director of RotorMotion, an executive helicopter charter business, said the aircraft was on a commercial flight from Redhill, in Surrey, to Elstree.
He said: "Our main priority now is for the family of the pilot and we extend our greatest sympathy to the friends and relatives of those who have died and been injured."
Addressing a press conference near the scene of the incident, Commander Neil Basu, of the Metropolitan Police, said: "It was something of a miracle that this was not many, many times worse."
It is understood the eight-seater aircraft was owned by Cornwall-based Castle Air but was leased to RotorMotion, which is based at Redhill Aerodrome.
Staff at Redhill Aerodrome confirmed it left the site at 7.35am amid low cloud cover and poor visibility, while the owner of London Heliport said he requested to land at one of its sites via Heathrow air traffic control.
But the Heliport never established contact with the pilot and shortly before 8am the aircraft crashed into the crane on top of The Tower in the St George Wharf development on the River Thames.
Witnesses described hearing a loud explosion as debris scattered across the sky and the helicopter plummeted to the ground, crashing near Wandsworth Road.
Video footage and photos flooded on to social media sites revealing chaotic scenes, with roads blocked off, burning wreckage and buildings damaged by flames.
London Fire Brigade station manager Bruce Grain, one of first firefighters at the scene, said it "was absolute chaos" but he revealed the fire was put out within 20 minutes.
Eight fire engines, four fire rescue units and around 60 firefighters plus officers attended the scene of the crash, a few hundred yards from MI6, on a busy road.
Firefighters rescued a man from a burning car and brought a blaze caused by the crash under control.
Four fire engines and two fire rescue units also attended reports of a crane in a precarious position. The brigade was called at 8am.
The crane was on top of a building called The Tower in the St George Wharf development, and is billed as one of Europe's tallest residential towers.
Video footage shot on a mobile phone showed an entire road blocked by burning wreckage and aviation fuel. The side of a building on one side of the street was also damaged by the flames.
Passers-by stood watching as the wreckage burned. A motorcycle was seen lying on its side in the road where it was abandoned.
Paul Ferguson, who was working in an office near the incident, told BBC News: "There was a flash and the helicopter plunged to the ground. It exploded and you can imagine the smoke coming out of it.
"It may be that on this misty morning the lights on nearby St George Tower weren't on and it moved and clipped the edge of the crane and lost control."
Witness Chris Matthison told BBC News: "There was some damage to the crane. The top of the nearest building is steeped in mist and difficult to see."
He added: "I heard a very unusual dull thud, then there was silence."
The aircraft is understood to be an AgustaWestland AW109, a lightweight, twin-engine helicopter with eight seats.
Steve Carslake told BBC Radio 5 Live that he saw a car explode with someone apparently trapped inside.
Mr Carslake said he had got out of a van in Mill Street and saw the aircraft hit the crane.
He said: "We heard someone was actually trapped in the car. We went to run towards the car and there was just a large explosion again."
The Met Police said they were "aware" of 11 casualties, including two dead.
One person was taken to a south London hospital in a critical condition, three people suffering minor injuries were taken to south London hospitals and five people were treated at the scene for minor injuries.
Met Commissioner Sir Bernard said: "We believe at the moment there are something in the order of 11 casualties and the other reason we're a little unclear is because people are presenting to different places trying to get help."
There was some confusion around the number of people in the aircraft, although it was earlier reported that it was flying between Gatwick and Elstree with two on board.
However, a spokesman for the RNLI said London Coastguard was contacted by Battersea London Heliport, which confirmed it had lost contact with one of its aircraft.
A lifeboat was launched from the Tower RNLI lifeboat station to search the Thames but is understood to have since stood down.
Traffic chaos broke out in the wake of the incident, with Vauxhall Bridge Road southbound closed, Wandsworth Road partially closed, Nine Elms Lane partially closed and South Lambeth Road partially closed.
Vauxhall Tube, train and bus stations are also currently closed.
Cloud in central London was very low at the time of the accident, according to MeteoGroup, the weather division of the Press Association.
Forecaster Paul Knightley said London City Airport was reporting a cloudbase of just 100ft (30.5m) at 8am.
"The top of the building would have been shrouded in cloud," he said.
The British Airline Pilots' Association (Balpa) said: "Today's two aviation incidents - in central London and in Japan - remind us that air safety is important for all types of operations, in all weather conditions and in every corner of the world.
"We will fully support the Air Accidents Investigation Branch (AAIB) who will be on site and help them determine the cause of today's tragic incident."
A spokesman for St Thomas's Hospital said: "We can confirm that three patients have been treated at St Thomas's Hospital following an incident in Vauxhall this morning."
Vehicles used by the London Duck Tours company are stored close to the scene of the accident but were not damaged.
A spokesman said tours had been cancelled because of the incident, and a film shoot planned for lunchtime for a private company would not go ahead.
The company's nine vehicles are converted Second World War landing craft and are a familiar sight around the streets of central London.
London Fire Brigade issued a later statement which said: "Six fire engines, four fire rescue units, a number of other specialist vehicles, 88 firefighters and officers are attending a helicopter crash near Wandsworth Road in South Lambeth. Firefighters have now brought the fire under control.
"The police have confirmed that two people have died at the scene. Fire crews have rescued a man from a burning car and he has been taken to hospital by London Ambulance Service crews.
"Fifty-seven firefighters and officers are also attending a crane which has been left in a precarious position at St George's Wharf as a result of the helicopter crash. Four fire engines and two fire rescue units are in attendance."
A spokesman for London Ambulance Service said four patients were treated at the scene for shock.
He said: "We have treated five patients for minor injuries and three of them were taken to St Thomas's Hospital and two - a man and a woman - were taken to King's College Hospital.
"We are treating four patients on scene for shock."
London Fire Brigade said its fire boat was doing precautionary checks of the River Thames.
A spokesman for Gatwick later said the helicopter had not flown from the Sussex airport, contrary to earlier reports.
Air crash investigators begin probe
Air investigators will seek answers to a series of key questions as they begin their inquiry into the London helicopter crash today.
There are strict rules governing helicopter flights in the capital and the Air Accidents Investigation Branch (AAIB) team will want to know if proper procedures were followed.
Pilots flying helicopters over London are subject to air traffic control clearance.
If they are flying over central London they must have twin-engined aircraft. Those flying one-engined aircraft must follow the route of the River Thames when operating in the capital.
Visibility over central London was poor enough to cause delays at London City Airport in London Docklands today.
If conditions are poor, helicopters might only be able to operate if the pilot was qualified to fly his aircraft by instruments only.
All those flying helicopters in London would have to follow a set series of routes laid down by the Civil Aviation Authority (CAA).
One of the routes begins at Bagshot in Surrey where helicopters could be requested to hold before their flight. This route would take helicopters through Surrey and south-west London, with various compulsory and voluntary reporting points on the way.
Another route comes in from Cookham in Berkshire and another from Northwood in north-west London. There are also routes coming in from Oxshott and Banstead in Surrey.
The London heliport is at Battersea in south-east London and there is also a heliport at Ascot in Berkshire.
The AAIB will want to know if the proper route was being followed, if conditions were fit for flying and if all precautions were taken.
It could be that the AAIB, as it normally does in major incidents, will issue a short interim report within days.
This report is likely to outline the basic facts of the incident, with a fuller report possibly taking some time to come out.