An alleged thief has used a dog lead and collar to steal a beloved German Shepherd from its yard in Lilydale, in Melbourne's north-east.

The man was seen on CCTV yesterday afternoon pulling up out the front of a home on Albert Hill Road in a silver Ford ute with roof racks.

The man, with a distinct tattoo on his right calf and on his forearm, then exits the car and allegedly chases the 18-month-old German Shepherd down with a lead.

Police told 9NEWS the dog has now been recovered by police this afternoon after a member of the public noticed the car in the CCTV at a Melbourne address. Authorities arrived at the property and recovered the dog.

The dog's owner has been reunited with the beloved pet this afternoon.

The dog's owner believes the same man and another person came past his house half an hour earlier in a blue Commodore sedan.

A person could be seen existing the Commodore and petting the dog over the fence.

The footage was shared to a Yarra Valley community group in a desperate plea for information. The post has since been shared thousands of times.