A white Maryland man accused of prowling the streets of New York City for a black person to "assassinate" has been charged with murder as an act of terrorism — the first time the Manhattan District Attorney's office has used the provision since the statute was changed right after 9/11.

James Jackson, 28, an Army veteran from Baltimore, "prowled the streets of New York for three days in search of a black person to assassinate in order to launch a campaign of terrorism against our Manhattan community and the values we celebrate," Manhattan District Attorney Cy Vance said.

Today a grand jury returned an indictment against Jackson, who is accused of fatally stabbing 66-year-old Timothy Caughman last week.

Jackson was charged with one count of murder in the first degree as an act of terrorism; one count of murder in the second degree as an act of terrorism; one count of murder in the second degree as a hate crime; and three counts of criminal possession of a weapon.

"Last week, with total presence of mind, he acted on his plan, randomly selecting a beloved New Yorker solely on the basis of his skin color, and stabbing him repeatedly and publicly on a Midtown street corner," Vance said.

"James Jackson wanted to kill black men, planned to kill black men, and then did kill a black man," Vance said.

In a jailhouse interview with the Daily News, Jackson reportedly said of his victim, "I didn't know he was elderly."

He also reportedly told the Daily News he would have rather killed "a young thug" or "a successful older black man with blonds."

Jackson reportedly said he wanted the murder to be "a practice run" for a bigger plan that would have more casualties, which he also allegedly told investigators.

Vance said that Jackson chose Midtown "because Manhattan is the media capital of the world, and a place where people of different races live together and love one another. We must never take for granted New York's remarkable diversity. We must celebrate it, protect it, and refuse to let violence and hate undermine the progress we have made as a city, a state, and a nation."

Jackson's next court date is set for April 13. His lawyer, Sam Talkin, declined comment to ABC News today, but said after his initial appearance in court that he would consider an insanity defense.

"If the facts are anything near what the allegations are, then we're going to address obvious psychological issues present," Talkin said. "We are going to let the dust settle and take a few minutes."