Married father-of-two David Black, 52, was shot several times from a car that pulled up alongside his on the M1, near Lurgan, Co Armagh, as he drove to work at Maghaberry jail yesterday.
Colleagues have said Mr Black, from Cookstown, Co Tyrone, had been actively considering retirement after more than 30 years' service.
Prime Minister David Cameron joined political leaders on both sides of the Irish border in condemning what he said was a "brutal murder". He said: "These killers will not succeed in denying the people of Northern Ireland the peaceful, shared future they so desperately want."
Stormont First Minister Peter Robinson branded the culprits "flat-earth fanatics living in the dark ages, spewing out hatred from every pore".
After being shot, Mr Black's black Audi A4 veered off the road and crashed into a deep drainage ditch.
Police have blamed dissident republicans opposed to the peace process. The violent extremists have been engaged in a long-running protest campaign against conditions inside HMP Maghaberry in Co Antrim – Northern Ireland's only maximum security prison.
Stormont Deputy First Minister Martin McGuinness insisted the murder would not destabilise the peace process. "Our community stands absolutely four-square and united against the activities of these groups," he said.
Mr Black has become the 30th prison officer killed in Northern Ireland since 1974, though the first for almost 20 years.
Police Service of Northern Ireland (PSNI) Assistant Chief Constable Drew Harris said dissidents had been actively targeting prison officers. He indicated the gunshots, not the crash, had been the cause of death, adding: "Mr Black appears to have sustained very serious and probably fatal gunshot wounds.
"The motive behind this is sheer terror."
The vehicle believed to have been used in the attack was later found burnt-out in the Inglewood area of Lurgan, Co Armagh – a town with strong pockets of dissident support.
Mr Black's service stretched back as far as the 1981 IRA hunger strike inside the Maze prison, when 10 republicans starved themselves to death.
Finlay Spratt, the chairman of the Prison Officers' Association representative body, knew the dead officer. "I found him to be a very nice fellow to work with," he said. "He always ensured he did his job to the letter. He was a very good officer, he certainly did his bit."
PSNI Chief Constable Matt Baggott said police had been working closely with the Prison Service over recent weeks and years to make sure staff get the best security advice and would be having more conversations following the attack.