Twelve people, including children, are dead after two gunmen armed with rifles opened fire at Bondi Beach on Sunday afternoon, in an act of terrorism targeting a Jewish holiday celebration.

Witnesses said two men stepped out of a vehicle on Campbell Parade, near Bondi Pavilion, and opened fire about 6.40pm on Sunday with footage showing blast after blast on the tourist strip. Some witnesses report more than 30 shots.

Video and photos taken by a Daily Mail photographer show a gunman, later identified as Naveed Akram, 24, from Bonnyrigg in Sydney's southwest, opening fire from an elevated bridge.

A festival for Hanukkah, named Chanukah by the Sea, advertised as a night of family fun, was taking place, with children attending the event when the gunmen, one of whom was on the terror list and known to authorities, opened fire.

NSW Premier Chris Minns confirmed 12 people were killed in a press conference late on Sunday.

Up to 29 injured people, including two police officers in critical condition and a child, have been taken to various hospitals in Sydney.

Prime Minister Anthony Albanese has condemned the shooting, which has been confirmed as an act of terrorism.

'This is a targeted attack on Jewish Australians on the first day of Hanukkah – which should be a day of joy, a celebration of faith,' he said.

A black and white flag was left on the bonnet of a car at the scene

'An act of evil antisemitism, terrorism, that has struck the heart of our nation... An attack on Jewish Australians is an attack on every Australian.'

Akram was shot, arrested and remains in custody, where he is being treated by emergency services. The second gunman has been shot dead.

Akram's home in Bonnyrigg was raided by police, as a crowd watched from the pavement. His family has owned the property for a year.

At least three residents were then drawn out of the home at gunpoint by police with their hands up.

It was also confirmed late on Sunday evening that a number of suspicious items had been found near the bridge where the gunmen fired rounds, including an improvised explosive device (IED).

The IED was removed by bomb squad specialists, driven away in an armoured car.

A black and white flag could be seen abandoned on the bonnet of a silver Honda at the scene. It is unknown what the flag means.

Larisa Kleytman was with her husband when he was shot dead while trying to protect her.

Married for five decades, Mrs Kleytman and husband Alex came from Matraville to celebrate Hanukkah.

The couple were in the crowd when Mrs Kletyman heard 'boom boom' and the shooting began.

'I think he was shot because he raised himself up to protect me, in the back of the head,' she said.

Mrs Kletyman and her husband came to Australia from Ukraine and have two children and 11 grandchildren.

Englishman Finn was video-calling with family back in London.

'I could hear fireworks going off - that's what it sounded like, anyway,' he said.

'I told my mum I'd go have a look, almost show her the view, in a way, and the next thing you know I saw a white car, with a guy firing from his car, and I saw an older lady who was killed.'

Tim Hamilton was with friends in North Bondi when he thought he heard a car backfiring but 'more violent than that, like a little bit louder'.

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'I stood up and looked over and then I just saw people on the beach running really fast away from that area, like the Bondi Pavilion but the north side of it,' Tim told Daily Mail.

He added that people were hiding behind the concrete wall and running into the ocean to try and stay clear of the shooters.

Tim said he did not receive an emergency alert on his phone following the incident.

'When we were walking home, we saw this guy who was up at Speedo Cafe, which is kind of near the North Bondi grass, and he was on the pavement bleeding.

'That was quite far away from where the shooters were. So I think one of the bullets must have travelled quite far. There were people helping him.'

Daniel, who is visiting Australia from Brazil, has described how he and a friend hid while the shots were fired and then they ran.

'A lot of people on the sand, on the ground, were trying to scream help,' he told ABC News.

'A lot of people on the floor, kids crying, looking for their mum.'

Daniel said it was hard to believe something like this could happen in Australia.

'After today, I don't feel safe anymore.'

The beach was crowded with hundreds of tourists and locals at the end of a 30C summer day.

Israeli Foreign Minister Gideon Sa'ar has criticised the Australian government for not heeding warnings about antisemitism.

'Unfortunately, the deadly terror attack in Sydney was expected,' he said in a video in Hebrew.

'We warned the Australian government countless times during this period. Unfortunately, it did not do enough.'

The sentiment was echoed by  Australia's special envoy to combat antisemitism, Jillian Segal.

She said this attack 'did not come without warning', referencing protests at the Sydney Opera House and across the Sydney Harbour Bridge.

'These are Australian icons. Targeting them is deliberate. This is not random. It is an attack on Australia,' Segal added.

Jewish federal MP Julian Leeser said the shooting was a 'terror attack'.

'Tonight's unfolding terror attack at Bondi Beach, occurring on the first night of (Hanukkah), is a horrifying tragedy,' he said.

'For Australians, tonight has turned into one of grief and shock.

'My heart goes out to those who were in Bondi, spending time with their family and friends, only to be confronted with fear and violence.

'Our Jewish community, which is known for its courage and stoicism, is shaken tonight.

'Even in darkness, light endures. Tonight, the values at the heart of (Hanukkah) matter more than ever.'

Imam Inam-ul-Haq Kauser, National President of the Ahmadiyya Muslim Community Australia, said members are praying for the families of those who have lost loved ones, and for a complete recovery to all injured.

'We are heartbroken by the brutality of this attack on a peaceful community gathering,' the Imam said.

'Such acts of violence, targeting innocent people and aiming to sow division and fear, have absolutely no place in Australia. An attack on any community is an attack on all of us.'

Bondi Anglican Church, located 100m from the shooting, went into lockdown during the attack while a few people went to help those fleeing the scene.

Pastor Matt Graham told ABC News the church had been opened up after the incident for anyone in need.

'People are just gradually moving away from there and people have been trying to find family members,' he said.

'We've had a number of people wandering in and going my cars down there and I can't get home.

'So we've got people who have been shuttling people to their homes all across Sydney ... we're getting people walking in constantly, just needing a bit of food or a hug or a prayer.'

Families were evacuated from the beach at about 9pm, with parents holding emergency blankets over their children.

People have been advised to avoid the area.

Transport for NSW has said the road closed in both directions between Lamrock Ave and Hastings Parade is 'expected to remain closed for some time'.

Buses are diverting away from Campbell Parade via local roads, skipping multiple stops.

Police confirmed there have been no reports of any other incidents in Sydney connected to the incident, including Dover Heights, where a similar Hanukkah event was expected to be held.

Head of Australian Security Intelligence Organisation (ASIO), Mike Burgess, has said the national terrorism threat level remained at probable.

'I don't see that changing at this stage,' he said.

'Probable means there is a 50 per cent chance of an act of terror... And unfortunately we've seen that horrific act occur tonight in Australia.'

He added that ASIO have no indications that the prospect of follow-up attacks is of concern.

`But of course we will work 24/7, along with our police colleagues, to make sure that is the case,' he said.

A critical incident has been declared, and the Law Enforcement Conduct Commission (LECC) is monitoring the investigation.

An extensive crime scene has been established and police have appealed for anyone with mobile phone vision or dashcam vision relevant to the incident to contact Crime Stoppers on 1800 333 000.