David Cameron arrives in Downing Street in London on Wednesday after interrupting his holiday.

AFP

Britain's Prime Minister David Cameron said on Wednesday it seemed "increasingly likely" that a British jihadist executed the US journalist James Foley.

Cameron, who broke off his holidays for meetings on the threat posed by Islamic State militants operating in Iraq and Syria following the beheading, said the likely nationality of the executioner was "deeply shocking".

Following the talks with senior ministers at his Downing Street office in London, he said "far too many" Britons had travelled to the region to take part in extremism.

"Let me condemn the barbaric and brutal act that has taken place and let's be clear what this act is - it is an act of murder, and murder without any justification," Cameron told reporters.

"We have not identified the individual responsible, but from what we have seen it looks increasingly likely that it is a British citizen.

"This is deeply shocking. But we know that far too many British citizens have travelled to Iraq and travelled to Syria to take part in extremism and violence. And what we must do is redouble all all our efforts to stop people from going."

He said Britain would remove the passports of people contemplating travel, strip extremist material off the Internet and prosecute people participating in extremist violence.

Cameron also said London would work with the new Iraqi government, help arm the Kurdish forces fighting Islamic State militants in northern Iraq and use Britain's aid, diplomacy and "military prowess" to put pressure on "this appalling organisation".

However, he insisted there would be no "knee-jerk" escalation of British military involvement, insisting the country was "not going to get involved in another Iraq war" while putting "combat boots on the ground" was "not something we should do".

"It is a battle we have to fight... whether it is dealing with this problem in Somalia, in Mali, in Afghanistan, in Iraq, in Syria," Cameron said, because "what happens in these other far-flung places can come back and cause huge harm here too".