The 20-year-old gunman, who law enforcement sources identified as Adam Lanza, fired what witnesses described as dozens of shots at Sandy Hook Elementary School in Newtown, Connecticut, which serves children from ages 5 to 10.
Authorities found 18 children and seven adults, including the gunman, dead at the school, and two children were pronounced dead later after being taken to a hospital.
Another adult was found dead at a related crime scene in Newtown, bringing the toll to 28, state police Lieutenant Paul Vance said.
US police and law enforcement agents were on Saturday trying to establish the motive behind his actions and questioned his elder brother and father.
Initially, local media reports and law enforcement agents had identified the gunman as 24-year old Ryan Lanza, who eventually turned out to be the elder brother of the attacker Adam Lanza.
20-year-old Adam, after killing his mother at home, opened indiscriminate fire in the Sandy Hook Elementary School in Newtown and gunned down 20 children aged between 5 and 10 as well as six adults, including the institute's Principal.
Adam, who was wearing black combat gear and armed with semi-automatic pistol and a semi-automatic rifle, later died from a self-inflicted gun shot wound, law enforcement agents said. He was found dead inside the school building.
As news of the shooting broke, Ryan wrote on his Facebook page that he was being wrongly identified as the gunman.
"I'm on the bus home now it wasn't me... It wasn't me I was at work it wasn't me (sic)," the elder Lanza said.
Adam's mother Nancy was a teacher at the school where the shooting occurred, media reports said.
The New York Times said he had first killed her in her apartment before gunning down 26 people at the school.
Connecticut Police spokesman Paul Vance told reporters outside the scene of shooting that Adam drove to the school where he opened fire in two classrooms located in one section of the building. He was carrying three guns, including a Sig Sauer pistol and a .223-caliber rifle, which was found in the back of a car.
FBI agents interviewed his brother Ryan in New Jersey's Hoboken area as well his father Peter Lanza, who was divorced from his mother.
In providing details of the shooting, Vance said law enforcement agents found "a very horrific and difficult scene" at the school, which had 700 students in kindergarten.
As reports of the shooting spread, panicked parents rushed to the school searching for their children as students covered in blood were being carried out of the building.
President Barack Obama, wiping away tears and pausing to collect his emotions in an address to the nation, mourned the 'beautiful little kids between the ages of 5 and 10 years old' who were killed.
A woman waits to hear about her sister, a teacher, following a shooting at the Sandy Hook Elementary School in Newtown, Connecticut. AP photo
"Our hearts are broken today, for the parents, and grandparents, sisters and brothers of these little children and for the families of the adults who were lost," Obama said, his voice cracking.
This undated Facebook photo shows Ryan Lanza, brother of alleged school shooter Adam Lanza. AFP PHOTO
"Our hearts are broken for the parents of the survivors as well, for as blessed as they are to have their children home tonight, they know that their children's innocence has been torn away from them too early and there are no words that will ease their pain," said Obama, who has two young daughters.
"Evil visited this community today," Connecticut governor Dannel Malloy told reporters.
The New York Times reported that the gunman walked into a classroom where his mother was a teacher, shot his mother and then 20 students, most in the same classroom, before shooting five other adults and killing himself.
Adam Lanza's brother, Ryan Lanza, was 'either in custody or being questioned,' a law enforcement source said.
The gunman was dead inside the school, Vance said. The Times reported he used a Sig Sauer and a Glock, both handguns, and said police also found at the scene a Bushmaster .223 M4 carbine, a rifle, that they believe belonged to him.
The holiday season tragedy was the second shooting rampage in the United States this week and the latest in a series of mass killings this year, and was certain to revive a debate about US gun laws.
Police, parents swarm school
Chaos struck as children gathered in their classrooms for morning meetings at Sandy Hook Elementary in Newtown, a wealthy, wooded suburb of 27,000 in Fairfield County, about 80 miles northeast of New York City.
Images from the scene showed children being led away in single file, each child's hands clutching the shoulders of the one in front. Police wearing body armor and carrying rifles swarmed the scene and locked down the school.
Distraught parents converged, frantically searching for their daughters and sons. Neighbors and friends wandered in shock, looking for information.
"We can't believe this," said Kinga Walsh, 47, a mother of four who was Christmas shopping when she heard there had been a shooting at the school. "Newtown is a quiet, nice place. It's a small, tight-knit community."
Nearly 12 hours later, the bodies of the dead children, adults and gunman remained in the school awaiting identification.
World leaders express shock over latest US shooting
Obama ordered flags flown at half-staff at US public buildings.
"As a country, we have been through this too many times," Obama said, ticking off a list of recent shootings.
Young children wait outside Sandy Hook Elementary School after a shooting in Newtown, Connecticut. REUTERS
"We're going to have to come together and take meaningful action to prevent more tragedies like this, regardless of the politics," Obama said in apparent reference to the influence of the National Rifle Association over members of Congress.
Obama remains committed to trying to renew a ban on assault weapons, White House spokesman Jay Carney said.
The Connecticut shootings appear certain to trigger renewed debate over US gun laws. New York Mayor Michael Bloomberg, founder of the advocacy group Mayors Against Illegal Guns, said it was "almost impossible to believe that a mass shooting in a kindergarten class could happen.
"We need immediate action. We have heard all the rhetoric before. What we have not seen is leadership - not from the White House and not from Congress," he said. "That must end today."
Outside the White House gates, about 200 people rallied on a cold evening in favor of gun restrictions.
French President Francois Hollande, in an open letter to Obama, said he was 'horrified' by the shootings.
Britain's Queen Elizabeth II on Friday told US President Barack Obama she was 'deeply shocked and saddened' by the US school massacre that left 28 people dead, in a rare public response to the tragedy.
In a message beginning "Dear President Obama", the 86-year-old monarch said: "I have been deeply shocked and saddened to learn of the dreadful loss of life today in Newtown, Connecticut; particularly the news that so many of the dead are children.
An emotional Barack Obama talks about the Connecticut elementary school shooting in this combo photo. AP
British Prime Minister David Cameron said, "It is heartbreaking to think of those who have had their children robbed from them at such a young age, when they had so much life ahead of them."
UN secretary general Ban Ki-moon expressed his condolences and called the targeting of children 'heinous and unthinkable.'
Bloodied children leave school
Vance said the shootings took place in two rooms of Sandy Hook Elementary. Witnesses reported hearing dozens of shots; some said as many as 100 rounds.
"It was horrendous," said parent Brenda Lebinski, who rushed to the school where her daughter is in the third grade. "Everyone was in hysterics - parents, students. There were kids coming out of the school bloodied."