Speakers at the International Conference on Terrorist Rehabilitation and Community Resilience said moderate Islamic groups and governments should make a concerted effort to counter extremist propaganda on the Internet.
YouTube, Facebook, Twitter and other social media are increasingly being exploited to spread extremist views, and moderate religious leaders and governments must keep pace to counter their arguments, they said.
Singapore Prime Minister Lee Hsien Loong said in a keynote speech that  self-radicalisation through constant exposure to radical views online was a "growing phenomenon".
"Jihadist sites and sermons by charismatic ideologue firebrands are just a mouse click away," said Lee, who also stressed the need for closer international cooperation against terrorism.
Some 500 security analysts, academics and religious leaders attended the forum.
Islamic scholar Ali Mohamed, co-chairman of Singapore's Religious Rehabilitation Group (RRG), said cyberspace "is shaping up to be the new battleground for hearts and minds".
The RRG counsels and reindoctrinates jailed militants and helps them reintegrate into society, including some arrested in late 2001 for allegedly plotting to bomb US and other targets in the city-state.
"Terrorists are increasingly exploiting the Internet as a tool for mass communication and radicalisation," said Ali.
"RRG believes that this is one of our greatest challenges today -- to deal (with) and counter the pervasive spread of terrorist ideologies and extremist views online."