Bourke Street stabbing: One dead, man arrested in Melbourne

At least one person was killed and two others wounded in a rush hour stabbing incident in Melbourne's central business district, police said on Friday.

Victoria Police said the unnamed attacker is in "critical condition" at the hospital following the incident, which left one of the victims dead.

According to them, the police initially responded to a report of a vehicle on fire near the corner of Swanston Street about 4.20 pm (10.50 am IST).

Local media showed footage of a large man slashing wildly at police officers before being shot.

Police have since confirmed the man was shot in the chest and is in a critical condition. At a press conference, a police spokesperson said there are no links to terrorism at this stage.

He said: "Three people have been stabbed, unfortunately one of them is deceased at the scene".

A second person suffered a head injury and has been taken to hospital.

As police officers reached the scene they were confronted by a knife-wielding man who tried to attack them.

The public has been urged to avoid the area, with hundreds of police officers and emergency services on scene.

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The exact circumstances are yet to be determined at this stage.

A third person has also been taken to hospital, although the nature of their injuries is not yet known.

Photo from the scene showed crowds of people behind police barriers.

A auto on fire near Target on Bourke Street.

'Police response was swift and overwhelming.

The incident occurred on Bourke Street just outside the Target Centre, near the intersection of Swanston St.

"People around me screamed that he had a knife but I couldn't see clearly from where I was", Meegan May said.

In multiple videos that surfaced, a man can be seen trying to stab two policemen who try to make several attempts to wrest the knife from the man.

It comes as a trial continues into the horrifying rampage in Bourke St in January previous year.

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