Dozens of residents are stranded in their homes on Sydney's north shore after a bomb went off in their street early this morning and a second was found under a car.

Officers were called to Walker's Drive in the Lane Cove North housing estate about 3:30am (AEST), when residents heard gunshots, followed by an exlosion.

When they arrived, police found a homemade bomb had blown up near a car on the street.

Sergeant Tony Bear says the explosion caused minor damage but police found a second bomb under the car.

The bomb squad was called in and the device was removed.

Ambulance crews arrived and were on standby but have since left the scene.

Police have blocked off the street, preventing about 50 people from driving out of the estate.

Forensic officers are examining the area and interviewing residents.

Police are asking any witnesses to come forward.