A man has been shot dead by police during an alleged armed robbery at a bottle shop in Melbourne's east.

Officers from the armed crime squad were in Park Orchards when the robbery took place about 9:00pm on Sunday.

An officer shot and killed the 48-year-old man after he allegedly threatened the shop attendant with a gun.

The man died at the scene.

Police were in the area investigating a series of armed robberies when they became aware of the hold-up, police said.

Officers also arrested a 49-year-old man and a 50-year-old man shortly after the shooting.

The two men are assisting police with their inquiries, police said.

The officer involved in the shooting was in the area investigating a series of recent robberies. ( ABC News )

Acting Deputy Commissioner Ross Guenther said the officers involved were not injured.

"The police member and colleagues are all OK," he said.

"As you can imagine these are quite traumatic circumstances for anyone that's involved."

"I can say that this is an active armed crime investigation that has been going for some time.

"There's been other offences of a similar nature being committed over the past few weeks and I believe it may be part of that series that was the basis of their being here."

The shooting will be investigated by Victoria Police's professional standards unit under standard protocol.

Family-run bottle shop previously targeted by thieves

A police spokeswoman said the officer involved, a Senior Constable from a specialist unit, was receiving departmental support.

The spokeswoman said police would not comment further as the matter was before the coroner.

The bottle shop is part of a small strip of stores on Park Road.

A large patch of blood was visible on the floor next to the counter this morning.

There appeared to be six security cameras covering the outside of the shop and many more set up inside.

Chris Wong, who owns a nearby cafe, said a man and his son ran the bottle shop and it had previously been targeted by thieves.

"[I'm] a bit surprised, this area is a quiet area and a nice area. But it's happened, robbery, a few times," he said.

Nicole Tracy, a naturopath whose business is on the same street, said she feared the latest incident may cause the man and his son to leave the area.

''They've put a lot of measures in place to kind of keep the place more secure, and it's just so sad that they've been hit again," she said.

"They're really lovely guys, the community really supports them, and it's not fair."