Melbourne - An Islamic State sympathiser planned to buy a gun and kill as many revellers as possible on New Year's Eve in Melbourne, police alleged Tuesday after foiling the plot.
Ali Ali, born in Australia to Somali parents, was arrested in a raid on a house in the Melbourne suburb of Werribee on Monday.
He appeared in court Tuesday charged with preparing to commit a terrorist attack and collecting documents to facilitate a terror attack. No bail was applied for.
Police claim the 20-year-old accessed a guide book online produced by Al-Qaeda on how to carry out terror acts and use firearms, but was arrested before he could purchase an automatic rifle.
"What we will be alleging is that he was intending to use a firearm to shoot and kill as many people as he could in the Federation Square area on New Year's Eve," said Victoria Police Deputy Commissioner Shane Patton.
"It is a tremendous concern to us that (during) the festive season, when people are out enjoying themselves, that there is a potential plot to commit a terrorist act. That is a huge issue for us but that is why we put the resources in."
Federation Square is in the heart of the city, opposite a busy train station and St Paul's Cathedral. It is one of the most popular places to see-in the new year and would be packed on December 31.
The alleged plot comes a year after police prevented what they said was another attack in the same area on Christmas Day, arresting several men who planned to use explosives, knives and guns to target the location.
Patton said Ali, who lives with his parents, had been on their radar since the beginning of the year, part of a small community of extremists that police have been monitoring.
His behaviour had gradually escalated over time, but police believe he was acting alone.
"The potential of the attack was catastrophic," said Patton, adding that the man was an "Islamic State sympathiser".
A person who knows Ali told the Melbourne Herald Sun: "He is a very quiet guy. This is an absolute shock."
Justice Minister Michael Keenan said the fact that the Christmas -- New Year period was again a target "reminds us of the depravity of terrorists".
"They seek to strike fear in the community when Australians are enjoying time over the Christmas period with their families and friends," he said, adding that there would be high-profile policing over the holiday period.
Australian officials have grown increasingly concerned over the threat of extremist attacks, raising the national terror alert level to "probable" in September 2014.
Since then, 74 people have been arrested in 347 counter-terror investigations.
Authorities say 14 attacks have now been prevented in the past few years, including an IS-directed attempt to bring down a plane using poisonous gas or a crude bomb disguised as a meat mincer.
Despite this, several attacks have taken place, including a cafe siege in Sydney in 2014 where two hostages were killed.