Here are the latest developments in this story:
Expressing his "deepest condolences" over the incident, PM Modi tweeted that he has offered to provide "all assistance to Pakistan in this hour of grief". "India stands firmly with Pakistan in fight against terror," he tweeted.
The Taliban terrorists, wearing suicide vests and carrying guns, had stormed the army-run school this morning. Dressed in military uniforms, they had slipped into the school from a graveyard and through the rear gate.
They barged into classrooms and pulling out students from under benches, shot them, said Shahrukh Khan, a boy who survived. Some children said the terrorists spoke to each other in a foreign language. (Read: Peshawar Student Describes Attack)
Reports said the terrorists even set a teacher on fire after pouring gasoline on her. Hours into the siege, heavy gunfire and multiple blasts were heard from inside the school.
The operation to flush out the terrorists, conducted by army commandos, took nearly 7 hours and stretched into the evening. Seven army personnel, including two officers, were wounded in the operation.
Taliban spokesman Muhammad Khorasani said the attack was a retaliation for a major military offensive in the region. "We want them to feel the pain," he said, adding the militants had been ordered to "shoot the older students but not the children".
The army-run school is attended by children of both army personnel and civilians.
Doctors at Peshawar's Lady Reading Hospital said many of those injured were in a critical condition. Over 120 people, among them over 80 children, have been wounded.
Condemning the attack, Pakistan Prime Minister Nawaz Sharif, who rushed to Peshawar, said, "This is a national tragedy, these were my kids, this is my loss". A three-day state mourning has been declared.
But Mr Sharif made it clear that the action against Taliban has entered a crucial phase and will not be stopped. "Operation Zarb-e-azab will continue until terrorism is completely wiped out from the country. We have had talks with Afghanistan," he said.
4 Pak Cops Killed In Taliban Terror Attack Taliban Demand US Return $3.5 Billion In Afghan Assets After Court Ruling 9/11 Victims Cannot Seize Afghan Central Bank Funds, Rules US Judge CBI Team At Kolkata Hospital For Digital Mapping Of Crime Scene Karnataka Chief Minister Siddaramaiah To Be Prosecuted In Land Scam Case Kolkata Rape-Murder: Fractures, 150 mg Semen, Other Claims Denied By Cops Ram Charan And Upasana Level Up The Twinning Game In Chic All-Black Looks Video: Man Skis Off 18,753-Foot Himalayan Cliff, Shatters World Record Court Reserves Order On Summoning Lalu Yadav, Tejashwi In Land For Job Case Track Latest News Live on NDTV.com and get news updates from India and around the world.