Some 60 animals on the farm near Guildford have tested positive for the disease which wreaked havoc in 2001.
A 3km protection zone has been put in place around the premises and a UK ban imposed on movement of all livestock.
Gordon Brown has cancelled his holiday in Dorset and taken part in a meeting of the government's Cobra emergency committee by telephone about the issue.
Very few human cases of foot-and-mouth disease have ever been recorded. The last human case reported in the UK occurred in 1966.
In accordance with legislation, all cattle on the Surrey premises will be culled, said a government spokesman.
The farm has been under restrictions since late on Thursday when symptoms were reported.
Debby Reynolds, UK Chief Veterinary Officer, confirmed the outbreak after samples were taken from the farm.
She said: "We are trying to form a picture of where the infection may have come from but at the moment it's very early stages."
Gordon Brown is returning to London on Saturday and Environment Secretary Hilary Benn is to break off from his holiday in Italy.
The Cobra committee is to reconvene on Saturday morning to review latest developments.
Ms Reynolds advised farmers across the UK to examine their animals carefully and immediately report anything suspicious.
As well as the 3km protection zone, there is also a 10km surveillance zone where nearby animals are monitored.
The outbreak in 2001 led to between 6.5 million and 10 million animals being destroyed and cost as much as £8.5bn. Many farms and other rural businesses were ruined.
National Farmers' Union President Peter Kendall said of the latest incident: "This is a matter of grave concern. We have an industry still depressed from low prices.
"We have to ensure this is a small isolated incident. We are working with the government to ensure the right steps are taken."
Hugh Pennington, emeritus professor of microbiology at Aberdeen University, said: "Speed is of the essence here.
"We have got to really stop this virus spreading, obviously first of all to stamp it out in the locality where it has been identified and then see whether the virus has got anywhere else."
Tim Bonner, from the Countryside Alliance, said: "Even the words 'foot-and-mouth' will send a chill through the spine of every farmer in the country.
"We hope for a better response this time from the government - the last time it was chaos."
