Counter-terrorism officers arrested a man and a woman during an operation near an Anglican church in North Melbourne on Friday afternoon.

Key points: Counter-terrorism officers arrested a man and a woman in front of the church about 1:30pm

Counter-terrorism officers arrested a man and a woman in front of the church about 1:30pm They were dressed in white plastic suits by police before being driven away

They were dressed in white plastic suits by police before being driven away It is still not clear what sparked the operation

A Victoria Police spokesperson said there was "no current or impending threat to the community" and two people were "assisting with inquiries".

The pair were released on Saturday without charge.

In a joint statement, Victoria Police and the Australian Federal Police (AFP) said the "routine" operation was not linked to a specific incident and was part of the Melbourne Joint Counter Terrorism Team's (JCTT) ongoing intelligence gathering.

"As part of this operation, a search was conducted at a residential property on Bedford Street," the statement said.

"It is also not linked to any imminent threat and the community should be assured that there is no ongoing risk as a result of this operation."

Counter-terrorism officers closed Howard Street between Queensberry and Courtney streets. ( ABC News: Virginia Trioli )

'They were holding machine guns'

The heavily-armed officers, some carrying machine guns, arrived outside St Mary's Anglican Church about 1:30pm on Friday.

ABC News Breakfast presenter Virginia Trioli, who was passing by, said the weapons being held by the officers "looked like they came out of Avengers: Infinity War".

"They were pointing at a man on the ground and there was a woman who was on the opposite corner who was down on the ground with a security person overlooking her as well," Trioli said.

She said a witness at the scene had told her the man was holding a backpack at arm's length and officers had screamed at him to drop it.

"The whole operation took about an hour, then he was finally led away in a police car and he was handcuffed and in a white HAZMAT suit, and so was the woman as well, but they'd been kept separate all that time," Trioli said.

She said both the man and woman had sat "passively" and quietly on the ground, not moving throughout the operation.

Police also retrieved several items during a search of a nearby flat.

Resident Thomas Langenheim said a Range Rover with flashing lights parked across part of the road next to the church shortly before the arrest.

"I saw two military-looking police people holding somebody at bay that was lying on the floor, and quite a few military people running around with machine guns," he said.

"They were holding the machine guns and they had helmets on and fatigue jackets and they were just sort of standing over the person that they had on the floor."

Heavily-armed police attended the scene. ( ABC News: Virginia Trioli )

Mr Langenheim said he was not frightened but did consider whether the dramatic arrest outside the church was connected to the recent Christchurch mosque attacks and Easter Sunday Sri Lanka terror attacks.

"The whole series of events in New Zealand, Sri Lanka sort of all came to mind and I thought it might have been something to do with retribution," he said.