At least 10 children and teenagers were among the dead, mown down as Mohamed Lahouaiej-Bouhlel ploughed his lorry through the festive crowd of thousands watching fireworks for France's national day on Thursday night.
Anti-terrorism prosecutor Francois Molins said the Tunisian attacker was "completely unknown" to the intelligence services but that the assault was "exactly in line with" calls from jihadist groups to kill.
Valls said Lahouaiej-Bouhlel, 31, was "probably linked to radical Islam in one way or another", although Interior Minister Bernard Cazeneuve cautioned it was too early to confirm a link.
As France was left reeling from its third major attack within 18 months, President Francois Hollande warned that the toll could rise further, with more than 50 people fighting for their lives.
The attack left a scene of carnage on Nice's picturesque Promenade des Anglais, with mangled bodies strewn over the palm-fringed walkway.
AFP reporter Robert Holloway witnessed the white truck driving at speed into the crowd, causing "absolute chaos".
"It was hurtling towards us and we had just enough time to yell at each other 'get out of the way!'," he said.
Dramatic video footage showed police surrounding the heavily damaged truck and firing through the windscreen to kill the attacker.
The massacre again prompted questions as to why France is such a persistent target for such attacks and what can be done to prevent such an unsophisticated assault.
Hollande's political opponents were already pointing the finger, with presidential contender Alain Juppe saying the carnage could have been avoided if "all measures" had been taken.
- Many foreigners dead -
Hollande said many foreigners were among the dead and injured in what he described as a "terrorist attack".
"France was struck on its national day... the symbol of freedom," the president said in a sombre televised address.
Two US citizens, a Russian woman, a Ukrainian, two Swiss nationals and three Germans were killed.
A Texas-based newspaper, the Austin American-Statesman, named the American victims as Sean Copeland, 51, and his 11-year-old son Brodie.
Hollande said France would observe three days of national mourning from Saturday and Paris city hall said the Eiffel Tower was to be lit in France's national colours on Friday in tribute to the victims.
It is the third time in 18 months that France has been left mourning its dead after jihadist attacks on Charlie Hebdo magazine in January 2015 and the shootings and suicide bombings in Paris last November that killed a total of 147 people.
The country has been in a state of emergency since November with heightened security, but the Nice carnage showed how vulnerable it remains to an attack.
- Driver a 'loner' -
Investigators were building up a picture of Lahouaiej-Bouhlel as man with a record of petty crime, but no known links to terrorist groups.
Neighbours described the attacker, who was born in Sousse in Tunisia and lived in a modest district of Nice, as a loner who never responded to their greetings.
He and his wife had three children, but she had demanded a divorce after a "violent argument", one neighbour said.
His wife was arrested on Friday and taken for questioning, a police source said.
The prosecutor said Lahouaiej-Bouhlel had been armed and at the end of his rampage he had fired "several times at three police officers" before he was shot dead.
Photographs after the carnage showed the truck, which had been hired on Monday, with its front badly damaged and riddled with bullet holes.
Molins said a fake pistol, fake rifles and a dummy grenade were found inside.
A German freelance journalist who witnessed the attack said he saw a man on a motorbike chase the truck in an attempt to stop it.
"The motorcyclist attempted to overtake the truck and even tried to open the driver's door, but he fell and ended up under the wheels of the truck," Richard Gutjahr, 42, told AFP.
"Then the driver stepped on the accelerator and the truck sped up, accelerated and drove in a zig-zag course into the crowd."
The condition of the motorcyclist was unknown.
- 'It was horrific' -
The extent of the injuries became clear when a hospital official said around 50 children were among the 200 injured. Some were "hanging between life and death".
"There are French among the victims and also many foreigners from every continent and many children, young children," Hollande said after visiting a hospital.
In a Facebook video, witness Tarubi Wahid Mosta recounted the horror of the attack's aftermath.
"I almost stepped on a corpse, it was horrible. It looked like a battlefield," the actor said.
World leaders rushed to condemn the bloodshed, with US President Barack Obama blasting it as a "tragic and appalling" attack on freedom. The UN Security Council held a minute's silence.
While no group has claimed responsibility, Hollande said France would "step up" military action against Islamic State targets in Syria and Iraq.
"We will continue striking those who attack us on our own soil," he said.
IS has repeatedly singled out France as a prime target for its military action against the group in Iraq and Syria, and hundreds of jihadists have left France to fight in its ranks.
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