Emergency services were called to Forbury Gardens in the town at about 19:00 BST on Saturday.
Two air ambulances were photographed landing at another park nearby to ferry the injured to hospital.
Armed police officers raided a block of flats in the town hours after the attack and large parts of the town remain cordoned off.
A 25-year-old man from the town, arrested on suspicion of murder on Saturday, has been now been re-arrested under Section 41 of the Terrorism Act 2000, Counter Terrorism Policing South East said.
Here are some images of the developments.
PA Media
Blue tents have been erected in the park after the incident on Saturday evening
PA Media
And forensics police were seen in Forbury Gardens on Sunday
AFP
Floral tributes have been placed at the park railings
EPA
A number of police cordons remained in place around Reading on Sunday
PA Media
Thames Valley Police's chief constable John Campbell delivered a statement to the media at the entrance to Forbury Gardens on Sunday afternoon
Steve Parsosn/PA wire
Thames Valley Police launched its response after receiving calls at about 19:00 BST on Saturday
@cogp79/AFP
Two air ambulances were photographed at King's Meadow in Reading, a short distance from Forbury Gardens
@OllieSirellLDR
Parts of Reading town centre were condoned off by Thames Valley Police
Stve Parsons/PA wire
Several ambulance crews attended the scene
Steve parsons/Pa wire
Armed police officers were later seen at a block of flats off Basingstoke Road in Reading
AFP
Police officers were stationed at all entrances to the park on Saturday night