Reports of stabbing attack in Sydney's CBD

Another view from a driver inside their Mercedes Benz where you can see the man wielding a knife on Clarence Street when he is confronted by a bystander with a chair trying to stop him

Another view from a driver inside their Mercedes Benz where you can see the man wielding a knife on Clarence Street when he is confronted by a bystander with a chair trying to stop him

Sydney CBD is in lockdown after at least one woman was stabbed at a hotel in the heart of the city. She has been taken to hospital in a stable condition.

Police officials issued a statement a short time ago stating that the woman's body was discovered "inside a unit" on Clarence Street in Sydney at approximately 3:15pm this afternoon.

"Officers from Sydney city police area command are on the scene and will be conducting inquiries into whether the incident was linked to an earlier stabbing on King and Clarence Street", police told Yahoo News Australia.

Police are yet to confirm the reports of a stabbing. The man - who appeared to be a young Caucasian man, with brown hair, wearing jeans and a shirt - has been arrested and taken into custody.

The Clarence Street entrance to Wynyard Station is closed.

NSW Police described the situation as very risky and hailed the courageous actions of those who had trapped the attacker.

Wood added that one stabbing was confirmed but alleged the man attempted to stab a number of other people before being restrained.

"These people are heroes, and I want to acknowledge that".

"I've even seen three undercover cop cars pull up and blokes running from them down the street", he said. "They were significantly courageous people".

The witness said the man ran off after being hit and rolling onto the front of his auto.

It's understood the woman had suffered knife wounds to her throat.

"My brother and I ran across here and we managed to get a grip along with other guy and we have a grip of him and restrained him fully".

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Investigators said that they found one smoke detector inside the attic of the three-story home. He said the blaze appeared to have started in the living room area on the first floor.

"Please avoid the area", police said on Twitter. There was fireys chasing him with axes and he went around the corner.

"People were chasing him by that stage".

He said the crowd was "shaken up, that's for sure".

"You dog. you stabbed a chick, mate", one of the men yelled at the suspect.

Police said the man attempted to stab "multiple people".

NSW Police arrested the man, who was barefoot and appeared to be a highly-agitated state.

Prime Minister Scott Morrison tweeted his support.

"Our thoughts are with all those who have been impacted by this violent attack", Mr Morrison tweeted. We don't know the causation or the rationale for the attack.

"Any further offical information will be provided by the New South Wales Police, who are keeping us appraised through our agencies, including details of casualties".

A dead woman with stab wounds was found in a nearby building.

Police have praised the efforts of passersby who held the attacker.

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