Authorities have been tailing the Hamilton Heights man, identified as Jose Pimentel, for at least a year.
Pimentel was arraigned Sunday night.
The charges accuse him of conspiracy going back at least to October 2010, and include first-degree criminal possession of a weapon as a crime of terrorism, and soliciting support for a terrorist act.
He was ordered held without bail.
Pimentel is a recent convert to Islam.
He was described as a loner who lived with his mother.
Pimentel was born in the Dominican Republic, came to the United States when he was 8 and is now a U.S. citizen.
Authorities say he spent much of his time on the internet and regularly visited TrueIslam1, a radical website.
Pimentel first come to the attention of authorities at least two years ago, attended mosque irregularly and has no known connections to any other local radicalized individuals or foreign terrorists.
Police Commissioner Ray Kelly says Pimentel was arrested while in the process of making pipe bombs and was ready to carry out his plan.
At a news conference, Mayor Michael Bloomberg called Pimentel "A 27-year-old al-Qaeda sympathizer.
Mayor Bloomberg said the alleged terrorist wanted to kill police officers, postal workers and American service members returning from abroad.
Police built a duplicate of the alleged terrorists device and detonated it at the Bomb Squad range. It blew apart a compact car.
"He was not part of a larger conspiracy," Bloomberg said.
He planned to test bombs by planting them in mail boxes.
He lived in Schenectady, N.Y. for a while before returning to Hamilton Heights.
Pimentel allegedly gave a confidential informant a 417 manual called "Organic Chemistry of Explosives" and another 374 page manual called "The Preparatory Manual of Explosives."
His website posted numerous articles advocating jihad.
"He was a reader of al-Qaeda's online magazine Inspire and inspire him it did," said Cy Vance, the Manhattan District Attorney.
In October, Pimentel allegedly purchased a clock similar to the one in the Inspire bomb-making article.
Also in October, Pimentel allegedly went to a Home Depot in the Bronx and bought elbow piping work gloves and Christmas lights; all items included in the Inspire article directions.
Police Commissioner Ray Kelly said the death of Anwar Awlaki spurred Pimentel on his path.
Kelly described the device in detail showing how he had shaved material from matches mixed them with sugar to form his explosive mix and intended to attach nails to it.
Police say they have have been aware of Pimentel since 2009. Upstate police first alerted NYPD to Pimentel.
"We had to act quickly yesterday because he was in fact putting this bomb together," Kelly said.
New York Governor Andrew Cuomo said of the arrest, "The arrest tonight of an individual suspected of planning to commit a terrorist act in New York demonstrates once again the effectiveness and bravery of our men and women in law enforcement. As families across our state gather this holiday season, we will continue to remain in close contact with our federal and local law enforcement partners to ensure the safety of all New Yorkers."
Luis Saverino is Pimentel's uncle.
He says his sister's son and lived with him on 137th Street in Hamilton Heights.
The 63-year-old uncle says he had no idea what his nephew was up to inside his bedroom, which he always kept locked.
When asked about his young nephew allegedly growing up to be an alleged angry terrorist, Saverino says Jose kept all thoughts of al-Qaeda to himself.
The uncle says Pimentel was arrested on the street on Saturday, the police later coming to the apartment to confiscate evidence.
Residents describe Jose as a loner in the neighborhood.
We're told he would hang out on the corner of 137th and Broadway bumming cigarettes, keeping to himself.