Two adults – believed to be trying to protect children – were also critically injured.
Merseyside Police were called to reports of a stabbing at 11.47am on Monday to a studio on Hart Street, where they arrived to find that multiple people had been subjected to a “ferocious attack” and had suffered serious injuries.
It is understood that children were attending a Taylor Swift event when an offender, who was armed with a knife, walked into the premises and started to attack those inside.
Enquiries are ongoing to establish the motive for this incident but it is not being treated as terror-related. Police are not looking for anyone else in connection with the incident.
Chief constable Serena Kennedy of Merseyside Police said: “A 17-year-old male from Banks in Lancashire, who was born in Cardiff, has been arrested on suspicion of murder and attempted murder and has been taken to a police station where he will be interviewed by detectives.
“As a mum of two daughters, and the nanna of a five-year-old granddaughter, I cannot begin to imagine the pain and suffering the families of the victims are currently going through and I want to send them our heartfelt condolences and sympathies.
“Our specialist family liaison officers are providing support to the families at this terrible time.
“I would appeal to anyone who witnessed anything, or who has information that could help our investigation or Crimestoppers on 0800 555 111.”