Race and religion do not only affect society and politics, but can also spark terrorism and violence, and this has afflicted many countries in South-east Asia, said Prime Minister Lee Hsien Loong.
Fostering multiracialism is crucial in inoculating Singapore against such strife, but that alone will not stop a terror attack, he added.
But the strong bonds between different communities will help Singapore cope the day after an attack, he said, noting that it is easy for an attack by terrorists - who claim to act in the name of Islam - to divide Muslims and non-Muslims, and split society.
PM Lee was speaking to 500 grassroots leaders last Saturday at the People's Association KopiTalk dialogue, at which he reiterated that Singapore is "not insulated from terrorism".
The threat posed by the Islamic State in Iraq and Syria (ISIS) has hit close to home, with hundreds of Indonesians and Malaysians travelling to the Middle East and the Philippines to join the terror group.
In Singapore, too, the Internal Security Department picks up one or two radicalised Singaporeans every month or two, said PM Lee. "They are not down and out, and neither are they from the Middle East. They were born and raised in Singapore, educated in state schools. But they have become self-radicalised," he added.
Given the situation, it was a matter of time before a terror attack happens, he said, urging people to fortify themselves "psychologically and emotionally as one people".
Even if most Singaporeans believed in multiracialism, "there would still be a handful who do not", and there was no guarantee there would not be an attack.
"But multiracialism will help us cope with the day after a terrible attack has happened - when people are in shock, in pain, and feeling angry and fearful," he said.
PM Lee, however, is confident that with the different communities, neighbourhood groups and religious leaders working together through such initiatives as the Inter-Racial and Religious Confidence Circles and SGSecure, "we can hold on together and let life go on as one people".