Anders Danielsson, the Swedish secret service director, raised the threat level one step from "low" to "elevated" based on assessments by the National Center for Terrorist Threat Assessment.
"The assessment is based on intelligence indicating a shift in activities among certain groups in Sweden, judged to be targeted at Sweden," the Swedish government said in a statement.
The alert noted that the threat isn't considered imminent, adding the threat level in Sweden was low compared with other European countries.
The Swedish alert follows similar development in Europe. Drones fired on targets in Pakistan, killing a senior al-Qaida commander and allegedly disrupted plans to carry out a major terrorist attack on European soil.
Security officials said an attack similar to the November 2008 assault in Mumbai was intercepted and thwarted by the strike in Pakistan. More than 150 people were killed when rebels tied to Pakistani militant group Lashkar-e-Toiba laid siege to Mumbai for three days in 2008.
Paris has been on a high state of alert since French President Nicolas Sarkozy declared war on al-Qaida in the Islamic Maghreb for beheading French engineer Michel Germaneau in Mali earlier this year.
French Interior Minister Brice Hortefeux said last week that the threat of terrorism in his country is "real."
The Swedish alert didn't mention specific groups or targets.