A terror plot to attack police stations and churches in Sydney has been foiled with the arrest of two alleged ISIS members.

Isaak el Matari, 20, and a 23-year-old associate were arrested by counter-terrorism police in raids across the city's west and southwest on Tuesday.

Both will later be charged with being members of a terrorist organisation and Matari with allegedly plotting a terrorist attack.

Matari, who was last year arrested in Lebanon accused of planning to join ISIS in Syria, will also be charged over alleged plans to fight in Afghanistan.

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Isaak el Matari, 20, (pictured) and a 23-year-old associate were arrested by counter-terrorism police in raids across the city's west and southwest on Tuesday

AFP Assistant Commissioner Ian McCartney said the alleged plot to attack 'landmarks' in the Sydney CBD was still in its early stages.

'We will say that they had a number of targets, including police stations, defence establishments, embassies and councils, courts and churches,' he said.

'[There were] discussions around locations, discussions around importing firearms and explosives to carry out those attacks... they were starting to reach out to people overseas.

'We will also allege [Matari] had indicated he was willing to travel to Afghanistan to fight for Islamic State, and he made a number of preparations to do so.'

A third man, aged 30, known to the other two men, but not involved in the alleged plot, was arrested in the raids over alleged Centrelink fraud.

Matari was arrested after police raided his home in Greenacre (pictured) along with five other locations on Tuesday morning

NSW Police Assistant Commissioner Mick Willing said the two alleged terrorists met each other online and communicated by WhatsApp and Telegram, among other platforms.

'These men knew each other via social media and being online, sharing a like-minded philosophy,' he said.

'That philosophy drove them to come together and to form a relationship that we are alleging underpinned some of the charges they're facing today.'

The 23-year-old was also allegedly 'prominent in the global online extremist community'.

Assistant Commissioner Willing said police believed the alleged plot was contained to the two men arrested.

'We have a number of associates in Sydney but we are satisfied the people we have arrested today are the people we need to arrest,' he said.

'Where alleging the plot planned in Australia was planned and focused on Sydney and not other states in Australia.'

Originally from Blacktown in Sydney's west, Matari was educated at the Australian Islamic College and prayed at Rooty Hill Mosque

A woman wearing full Islamic dress leaves Matari's home in Greenacre as police search it

Police seized crates of evidence and said the operation could take days to complete

He said police discovered the alleged plot after Matari was deported back to Australia from Lebanon last year and was immediately put under surveillance.

'Before he travelled overseas to Lebanese, he wasn't of interest to Australian authorities... we had concern once he returned to Australia. Movements have been monitored since he returned to Australia,' he said.

Matari spent about a year in the notorious Roumieh prison in Beirut after he was arrested by Lebanese authorities on August 31, 2017.

At the time of his arrest, Lebanon claimed he was just two days away from crossing the border into Syria to link up with ISIS fighters.

Court documents show that during interrogation, Matari claimed he was encouraged to join ISIS in Syria by a Sydney charity.

Originally from Blacktown in Sydney's west, he was educated at the Australian Islamic College and prayed at Rooty Hill Mosque.

Matari (police pictured raiding his home), who was last year arrested in Lebanon accused of planning to join ISIS in Syria, will also be charged over alleged plans to fight in Afghanistan

Lebanese authorities claim he became radicalised in Australia after watching ISIS videos online.

In the month of his arrest, Matari posted a photo of himself wearing Islamic clothing and squatting next to a sheep which had its throat cut.

According to the Lebanese court dossier, he was accused of downloading how to make bombs and videos of ISIS assassinations from the internet.

The ISF alleged Matari contacted an ISIS cadre in Syria and was willing to 'carry out a suicide or explosive operation in Lebanon'.

Assistant Commissioner McCartney said Matari took several steps, such as obtaining visas and buying plane tickets, towards travelling to Afghanistan to fight with ISIS there.

'He had planned to purchase a firearm when he arrived in Afghanistan and through these activities he swore allegiance to Islamic State and he would carry out activities for Islamic State when he went overseas,' he said.

Forensics officers and investigators wear face masks as they emerge carrying bags of evidence

He said it was not clear whether Matari planned to head to Afghanistan after the Sydney attacks, or if the two plans were developing as different options.

Assistant Commissioner Willing said police pounced on the pair after a year-long investigation as soon as they had enough evidence.

'We do go early on some of these matters as well when we think there is sufficient evidence,' he said.

'It is better to err on the side of public safety in some of these investigations than to let some of them go on, and we've made that decision today, but it has been complex and it's taken a lot of resources.'

Assistant Commissioner Willing said the alleged plot was the 16th police had foiled since the terror threat level was raised in 2014.

'There are people out there who still want to commit acts of terror in this country, sadly, but we're doing everything we can to prevent those acts of terrorism taking place and public safety is always our first priority,' he said.

'The online environment provides fast and easy access to information and, unfortunately, those benefits are also being exploited by extremists, who use digital technologies to exist 'virtually' if their physical existence is under threat,'

Assistant Commissioner Willing said police pounced on the pair after a year-long investigation as soon as they had enough evidence

NSW Police carried out six raids in western and southwest Sydney on Tuesday morning in Toongabbie, Greenacre (pictured), Canada Bay, Chester Hill and Ingleburn

NSW Police carried out six raids in western and southwest Sydney on Tuesday morning in Toongabbie, Greenacre, Canada Bay, Chester Hill and Ingleburn.

The three arrested men were taken to Bankstown Police Station and are expected to be charged later on Tuesday.

Police said the arrests followed an investigation 'targeting a group of people alleged to support the Islamic State terrorist organisation'.

'There is no immediate threat to the safety of community as a result of this activity,' they said.

The Joint Counter Terrorism Team, which comprises both NSW and Australian Federal Police officers, is investigating and carried out the raids.