Foreign Office minister Baroness Anelay said there was growing proof that Daesh militants are converting the popular toys into weapons in their Middle East heartlands.
A NATO chemical weapons expert also claimed the killer drones could be fitted with World War I mustard gas.
She said: “The Government has evidence that Daesh has used small, commercially available unmanned aerial vehicles in Syria and Iraq to extend their surveillance capability, produce propaganda material and carry small improvised explosive devices.”
It triggered calls for tough new controls on drones which are widely available on the High Street – such as automatic “off switches” if they approach key landmarks or sensitive sites.
Admiral Lord West, former head of the Navy and ex-security minister warned that without extra curbs militants could use them to launch an attack here.