The teen was held on suspicion of murder and attempted murder. Nine other children were wounded, six of them critically, and two adults are also fighting for life.
"We believe that the adults who were injured were bravely trying to protect the children," Chief Constable Serena Kennedy from Merseyside Police said on Monday.
The attack took place during a yoga and dance workshop for children. (EPA PHOTO)
Emergency services arriving at the scene found "multiple people, many of whom were children, had been subjected to a ferocious attack and had suffered serious injuries".
An advertisement posted online described the event as a yoga and dance workshop for children aged between six and 11.
Police said the motive for the attack was unclear but it was not believed to be terrorism-related and they were not looking for anyone else in connection with the stabbings.
Armed police arrested the suspect and seized a knife after being called around 11:50am to an address in Southport, north of Liverpool.
"The events today are just truly awful, and I know the whole country is deeply shocked at what they've seen and what they've heard," Prime Minister Keir Starmer told broadcasters.
"Our thoughts and condolences are with the victims, their families, their friends and the wider community, and it's almost impossible to imagine the grief that they're going through."
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