Milad Atai and a Sydney schoolgirl were arrested on Tuesday morning

Western Sydney man Milad Atai, 20, was arrested by counter-terrorism investigators on Tuesday morning

A schoolgirl, 16, and western Sydney man Milad Atai, 20, were arrested by counter-terrorism investigators on Tuesday morning.

Police allege the pair from Guildford in Sydney's west were 'raising money' to send to the Islamic State terror group.

They expect to charge both with getting funds to or from the Islamic State terror group. The charge carries a maximum penalty of 25 years behind bars.

The pair are not related and are not thought to be in a relationship.

Atai was a target of the original counter-terrorism raids conducted under Operation Appleby in September 2014.

He was named among a group of 18 suspected extremists in a control order last year.

NSW police deputy commissioner Catherine Burn (right) and AFP deputy commissioner Michael Phelan made the announcement on Tuesday morning

Deputy NSW police commissioner Catherine Burn said the girl was not someone 'well known to police'.

However, investigators will allege the schoolgirl was involved in 'extremely serious matters'. Police will allege the pair used 'mechanisms' to raise the funds but were not specific.

'It is disturbing we are continuing to see a trend of teenaged children involved in these activities,' Ms Burn told reporters.

Both were taken to Granville Police Station and are expected to be brought before the courts later on Tuesday.

Police said the arrests do not relate to a specific terrorist threat.

14 people have now charged under Operation Appleby since September 2014.