Australian police have arrested a man who attacked a pedestrian on Tuesday with a knife and stabbed a woman in Sydney before being controlled.

The incident took place in a downtown business district. Witnesses said a number of bystanders confronted the attacker with plastic chairs and boxes and managed to arrest him after stabbing a woman.

Police said a body was found near the site of the attack in the same neighborhood, but did not confirm whether there was a link between the two incidents.

According to some eyewitnesses, the attacker chased several people but only managed to injure the woman, who was described as stable after being taken to hospital.

According to a videotape aired by Australian media, the attacker uttered the words "Allahu Akbar" and went to the police saying "kill me", while police said they had received reports on the man's words but has not yet confirmed the motive of the attack.

Television footage showed police arresting the attacker, who appeared to be a young man in his twenties.

Australia has in the past been stabbed or tied by authorities to religious extremism, including a stabbing last year in Melbourne that was claimed by the Islamic State.