The European Air Safety Organization said the disruption, the biggest seen in the region, could last another two days and a leading volcano expert said the ash could present intermittent problems to air traffic for six months if the eruption continued.
The volcano began erupting on Wednesday for the second time in a month from below the Eyjafjallajokull glacier. It hurled a plume of ash six to 11 kilometers (3.8 to 7 miles) into the atmosphere, and this spread south east overnight.
Icelandic volcanologist Armannn Hoskuldsson said on Thursday the eruption was growing more intense.
Britain barred flights in its air space, except in emergencies, until at least 0600 GMT on Friday.
It was the first time "within living memory" that a natural disaster had caused such a halt, a spokeswoman for Britain's National Air Traffic Service (NATS) said. Even after the Sept. 11, 2001 attacks on US cities, Britain did not close its air space, she said.
"We continue to work closely with airports, airlines, and the rest of Europe to understand and mitigate the implications of the volcanic eruption," NATS said in a statement.
The precautions were taken because volcanic ash contains tiny particles of glass and pulverised rock which can damage engines and airframes.
"Safety is the first and predominant consideration and if any of the traveling public are inconvenienced I apologise for that," British Prime Minister Gordon Brown said.
Paris, Brussels, Amsterdam and Geneva airports said they had canceled a large number of flights and Eurocontrol spokesman Brian Flynn said on Thursday afternoon the problem could persist for a further 48 hours.
Airline staff at Stansted airport, north-east of London, told customers it could be closed until Sunday, said stranded passenger Andy Evans.
"People just don't know what to do," he said. "There are hundreds of people in the queues at the sales desks." A spokesman at Heathrow, Europe's busiest airport, said 840 out of 1,250 flights on Thursday were affected, disrupting about 180,000 passengers. More than 100,000 other passengers were affected at Gatwick and Stanstead. In 1982 a British Airways jumbo jet lost power in all its engines when it flew into an ash cloud over Indonesia, gliding toward the ground before it was able to restart its engines.
The incident prompted the aviation industry to rethink the way it prepared for ash clouds, resulting in international contingency plans activated on Thursday.
Scientists said the ash did not pose any health threat because it is at such a high altitude.
Bill McGuire, professor at the Aon Benfield UCL Hazard Research Center, said if the volcano continued erupting for more than 12 months, as it did the last time, periodic disruptions to air traffic could continue.
"The problem is volcanoes are very unpredictable and in this case we have only one eruption to go on," he said. "And a lot depends on the wind. I would expect this shutdown to last a couple of days. But if the eruption continues - and continues to produce ash - we could see repeated disruption over six months or so."
Brian Flynn, deputy head of operations at Eurocontrol: "The extent is greater than we've ever seen before in the EU." "The meteorological situation is such that the volcanic ash is progressing very slowly eastwards but there is not a lot of wind... so it is very slow and very dense." Russian Prime Minister Vladimir Putin was forced to cancel his trip to Russia's Arctic town of Murmansk on Thursday. "The cloud has covered the entire region. Flights are not allowed," said Putin's spokesman Dmitry Peskov.
The eruption has grown more intense, University of Iceland volcanologist Armannn Hoskuldsson said.
To the east of the volcano, thousands of hectares of land were covered by a thick layer of ash, while a cloud was blotting out the sun in some areas along the southern coast of Iceland, local media reported.
Sweden said it would close its airspace from 2000 GMT.
All air traffic in and out of Norway's main Oslo Airport was canceled while flights from Denmark's Copenhagen airport were also severely disrupted.
Finland's airport manager Finavia said central and northern Finland's air space would be closed until 1200 GMT on Friday, and Finnair said it had canceled nearly 50 domestic and international flights.
The Danish part of North Sea air space has been closed, Danish air traffic controller Navair said, with the entire Danish air space due to be closed by 1600 GMT.
A spokeswoman for the German air traffic body said there were no immediate plans to shut German airspace. Rail company Eurostar said it had received a big boost due to the disruption to air travel, with hundreds of enquiries from stranded passengers trying to enter or leave Britain.