James Clapper raised concerns about the “fundamental conflict” between national security and freedom of movement across the European Union.
At a briefing with journalists in the United States, the director of National Intelligence said that IS, also known as ISIL, had taken advantage of the migrant crisis in Europe and there was evidence of plotting.
Asked if clandestine IS cells like those in Brussels existed in England, Germany, and Italy, he replied: “Yes, they do. That is a concern of obviously ours and our European allies.”
He added: “We continue to see evidence of plotting on the part of ISIL in the countries you name.”
Mr Clapper said the US was doing all it could to share information about IS with its intelligence counterparts.
EU governments were increasingly aware the jihadists were exploiting the migrant crisis, he said.
“They have taken advantage to some extent of the migrant crisis in Europe, something which the nations have a growing awareness of.”
Mr Clapper told the Christian Science Monitor event that one of the challenges in tackling IS was its increasingly sophisticated technological methods.
He added: “The obstacles in Europe, have somewhat to do with some of the fundamental conflict between, on the one hand, EU incentives and drives to promote openness and free movement of people and goods, privacy, which is in some ways in conflict with the responsibility each country has as a nation state to protect the security of its borders and its people.
"Those are sort of countervailing processes.”
The British Labour Party’s Keith Vaz, chairman of the home affairs select committee, told The Daily Telegraph the concerns must be taken seriously.
“This is a worrying view which needs to be taken very seriously as it comes from a key ally which works with the UK closely on these matters,” he said.