The UK Home Office says a terrorist attack was "possible but not likely"
MI5 has downgraded the threat level to Britain from Northern Ireland-related terrorism.
The UK Home Office said the threat had been reduced from substantial to moderate, meaning a terrorist attack was "possible but not likely."
It said the UK still faces a "severe" threat from international terrorism, meaning an attack is "highly likely."
British Home Secretary Amber Rudd said: "Despite the change which has been made today, there remains a real and serious threat against the United Kingdom from terrorism and I would ask the public to remain vigilant and to report any suspicious activity to the police regardless of the threat level."
The decision to reduce the terror threat from Northern Ireland to the second-lowest level was taken by the security service based on latest intelligence, Ms Rudd added.
The threat level to Northern Ireland from terrorism based in the country itself remains "severe."
There are five threat levels - low, moderate, substantial, severe and critical. They are decided based on a range of factors including intelligence, terrorist capability, and timescale.
The UK had previously faced a "substantial" terror threat from Northern Ireland - meaning there was a "strong possibility" of an attack - since May 2016.
Then-home secretary Theresa May said at the time the move reflected "the continuing threat from Dissident Republican activity."
Last September the UK's threat level from international terrorism was reduced from critical to severe, meaning an attack is considered highly likely rather than imminent.
The level had been raised to the highest - critical - following the bucket bomb blast at Parsons Green Tube station that left 30 passengers injured.
Troops were deployed to key locations so armed police were freed up to patrol the streets.