Ten children all under the age of three, all badly wounded and two adults underwent surgery. All were reported in stable condition.
After the attack in this town 20 miles (30 kilometers) northwest of Brussels, sobbing parents congregated outside the day care center that serves up to 30 youngsters in a town house on a residential street.
"An act of great brutality has happened here against our weakest citizens," said mayor Buyse Piet. "The whole city is united in support for the parents who are in deep grief."
Christian Du Four, a local prosecutor, said after the assault the attacker walked out, got back on his bicycle and was arrested at a nearby supermarket shortly later.
He said the man was 20 years old, wielded a knife of 20 centimeters and had painted his face white with black around the eyes. He found the door to the Fabeltjesland day care center unlocked.
"After he entered he started slashing at everyone he ran into ... the day care workers, the children," Du Four told a news conference.
Others spoke of finding a scene of crying and bleeding babies inside the center.
Theo Janssens, a Dendermonde city councillor, arrived with first aid workers. "The situation was horrible. There were blood-stained babies and staff workers everywhere," he said on the VRT television network.
Du Four said one worker failed to disarm the intruder and another was stabbed to death.
He did not name the suspect but said he was uncooperative under questioning. The man who Du Four said had no criminal record was to appear before a magistrate later Friday or on Saturday to be indicted.
He killed two children and a woman working in the center.
Crown Prince Philippe and his wife Princess Mathilde met with relatives of the victims as well as first aid workers.
Dr. Ignace Demeyer, head of emergency services at the Our Lady Hospital in nearby Aalst, said 10 injured children and two care workers underwent surgery at six hospitals. They were in stable condition.
"All the kids had multiple stab wounds on their legs, arms and all over their bodies," he said
He said 21 children were at the center at the time of the attack, and nine were unharmed.
When the first police and ambulance sirens were heard, someone in Bie Hoornaert's bake shop joked it might be a repeat of a 2007 prison break at a nearby jail.
In stead, Hoornaert said later, she and her customers they were treated to "something you hear about from America, not here."
Du Four said police had to show distraught parents digital photographs of those taken to the hospital, asking them to identify their children.
"People are totally in shock," said Leen Du Bois, a spokeswoman for the regional government of Flanders. "Nobody would have imagined anyone could do so much harm. There is much grief."
She said the perpetrator had no connection to the day care center.
Government officials provided psychological counseling to family members and witnesses of the stabbings, and police cordoned off the area.
Veerle Heeren, the social welfare minister for the regional Flemish government, said she would be investigating security measures at