"That is always a threat," the Bishop of Bristol told Premier.
Rt Revd Mike Hill fears the situation in the Australian city, where a man carrying an Islamic jihad flag took 17 people hostage, could damage relations between Muslims and Christians.
"I hope this is minority stuff but one has read after terrorist incidents that ordinary Muslims are abused verbally and even spat on.
"That seems to me to be entirely unacceptable."
The siege ended after 16 hours when police stormed the building in a gunfight that left two hostages and Iranian-born gunman Man Horan Monis, 50, dead.
Bishop Mike is the duty bishop in the House of Lords this week and said the incident was very worrying but it was important that Islam was not blamed.
He said: "This kind of extremism is a minority amongst a minority.
"We can't brand all followers of Islam with the same brush."
He added: "I think we need to stand by the vast majority of our Muslim brothers and sisters in not stereotyping all Muslims as people who are likely to do dreadful things.
"That's not my experience - I don't believe it to be true."
Meanwhile a special mass has been held at St Mary's Cathedral in Sydney.
Catholic Archbishop Anthony Fisher told the service that "hell has touched us".
"Today, the heart of our city is broken by the deaths of two innocents - hostages, along with their tormenter," he said.
He added that he had often been a customer of the café and the city was "used to living in a peaceful, tolerant and secure society in which people may enter a café and order a hot chocolate without fear".
"The darkness need not overcome the light. There is something greater than hatred and violence - there is love," he said