An 18-year-old man has been arrested in north-western Sydney by federal and New South Wales police for allegedly planning an "imminent" terrorist act.

Tamim Khaja, of Macquarie Park in Sydney's north-west, was arrested in Parramatta about 10:00am by the Joint Counter Terrorism Team, comprising of officers from the Australian Federal Police, the NSW Police, and other government agencies.

The ABC understands that he was a former student at Epping Boys High School and when he was in year 12 last year he was investigated by counter-terrorism police after allegedly preaching radical Islam at the school.

Authorities said the arrest was not related to raids earlier today at properties in Melbourne, which were part of an operation connected to the arrest of five Victorian men who allegedly planned to travel to Indonesia by boat.

NSW Police Deputy Commissioner Catherine Burn said Khaja's arrest had prevented an attack, which was allegedly being planned and was described as "probably imminent".

Sorry, this video has expired NSW Police: Arrest of 18yo is 1 of 9 imminent attacks prevented by police

Australian Federal Police Acting Deputy Commissioner Neil Gaughan said police will allege Khaja was looking for "possible sites in Sydney to undertake a terrorist attack and was making arrangements to acquire a firearm".

Deputy Commissioner Burn said police would allege Khaja was also planning to leave the country to go to Syria to join Islamic State.

"He does have associations with some of the people that have already been put before the courts," she said.

Deputy Commissioner Burn would not identify which people and how they were linked, but said Khaja was acting alone in this alleged plot.

She said police monitoring of his activities culminated in his arrest.

Arrested man was known to police for about a year

Acting Deputy Commissioner Gaughan said Khaja was expected to be charged with planning a terrorism attack and preparing for foreign incursions.

He said both offences carry a maximum sentence of life in prison.

AFP Acting Deputy Commissioner Neil Gaughan said the man was acting alone. ( AAP: Mal Fairclough )

He is expected to face Parramatta Local Court on Wednesday.

"We have taken swift action to ensure the safety of the community and we are satisfied that any threat to the community posed by this individual has been mitigated," he said.

He said Khaja, who has been known to police for about a year, had attempted to leave the country to fight with terror organisations overseas in February, but was "unable to".

Acting Deputy Commissioner Gaughan said his passport was later cancelled.

He said police were currently in the charging process and allegations were yet to be taken to the court so he was not in a position to go into more detail, but said the arrest was another example of the disturbing trend of Australians allegedly subscribing to terrorist ideologies.

Khaja's lawyer Osman Samin said bail would be applied for "in due course".

Arrests 'highlight importance of disruption strategies'

Deputy Commissioner Burn said the arrest today had kept the community safe, which was the priority of police.

"This arrest today again highlights the importance of our disruption strategies," she said.

"Unfortunately what is concerning is that we are still seeing people who want to do an attack in our country.

"We are still seeing people planning and preparing for such attacks and unfortunately that group of people are getting younger and younger.

Sorry, this video has expired Attorney-General: The arrested 18yo was known to law enforcement authorities

"As we all know, youth are vulnerable particularly around the radicalisation and we have a lot of things in place to try to deal with it but it is still of absolutely concern that we are still continuing to see it happen."

She said this was one of nine planned terror attacks the NSW Police Joint Counter Terrorism Taskforce had prevented as part of the ongoing Operation Appleby.

Deputy Commissioner Burn said the police could not tackle the risk of youth radicalisation alone.

"We all have to work together, whether it's families or schools or community groups, other institutions, everybody has to work together because we can't be in every young person's bedroom," she said.

"We can't watch everybody's accesses of their smartphones, so it's up to all of us to work together particularly the mums and the dads, the brothers and the sisters, the friends and the colleagues, just to watch out.

"Watch for those signs, there is always a sign when people are behaving differently and on their path to radicalisation, our job, as police, is to stop that."