Five people were killed and several others injured -- including a small child -- when a knife-wielding attacker rampaged through a busy Sydney shopping centre on Saturday, Australian police said.

Multiple people were stabbed by the unidentified assailant, who was shot dead by a policewoman at the scene.

The incident occurred at the sprawling Westfield Bondi Junction mall complex, which was packed with Saturday afternoon shoppers.

"I'm advised that there are five victims who are now deceased as a result of the actions of this offender," said New South Wales police assistant commissioner Anthony Cooke.

The motive was not immediately clear, but Cooke said "terrorism" could not be ruled out at this stage.

"I do not know at this stage who he is. You would understand this is quite raw. Inquiries are very new and we are continuing to make attempts to identify the offender in this matter," said Cooke.

A New South Wales Ambulance spokesperson told AFP that eight patients were taken to various hospitals across Sydney, including a young child who was taken to the city's Children's Hospital.

"They all have traumatic injuries," the official said.

Security camera footage broadcast by local media showed a man wearing an Australian rugby league jersey running around the shopping centre with a large knife and injured people lying lifeless on the floor.

Eyewitnesses described a scene of panic, with shoppers scrambling to safety and police trying to secure the area.

Several people took shelter in shops as they tried to protect themselves and their families.

- 'Running and screaming' -

Pranjul Bokaria had just finished up work and was doing some shopping when the stabbing occurred.

She ended up running to a nearby shop and taking shelter in a break room.

"It was scary, there are some people who were emotionally vulnerable and crying," she told AFP.

She escaped using an emergency exit with other shoppers and staff, which took them to a back street.

She described a scene of "chaos", with people running, and police swarming the area.

"I am alive and grateful," she said.

Reece Colmenares was on her way to the gym when she saw "people running and screaming" past her.

She told AFP the people were saying someone had been stabbed so she ran into a nearby hardware shop with 10 to 12 other people

"They took us down [to a room] and closed the shop," she said.

"It's scary, there are little children and elderly and people in wheelchairs everywhere."

As night fell, dozens of police and ambulances were still outside the shopping complex, with stretchers ready to take people to nearby hospitals.

The sound of police sirens and helicopters filled the air.

The mall has been locked down and police have urged people to avoid the area.

Australian Prime Minister Anthony Albanese echoed Australians' sadness and shock at the attack.

"Tragically, multiple casualties have been reported and the first thoughts of all Australians are with those affected and their loved ones," he wrote on social media platform X.

Such attacks are virtually unheard of in Australia, which has relatively low rates of violent crime.