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Merseyside Police believe the car was able to follow an ambulance after a road block was temporarily lifted to treat a member of the public.
Four people are 'very, very ill' after sustaining injuries in the car-ramming, the city's mayor said. A 53-year-old suspect has been arrested.
Merseyside Police acted "very, very quickly" to stamp out speculation on social media that had caused "real consternation", Liverpool mayor Steve Rotheram said.
Police said they did not believe the incident was terrorism-related. Twenty people were treated at the scene. Ambulance officials said of the 27 taken to hospital, four were children.
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