The lone terrorist who fatally stabbed a man in busy Bourke St on Friday planned to cause an explosion in central Melbourne by igniting gas cylinders in his vehicle, police say.
Only after he was shot did police realize that three members of the public, all men, had been stabbed. The video also shows another individual, dubbed "trolley man", quickly barging in with a trolley directly hitting the attacker and stalling him to buy the police some time.
He brandished a knife and stabbed three men, one of whom, who has yet to be identified, later died in hospital.
"We are treating this as a terrorism incident", he said.
Police said that his improvised explosive device was made up of gas cylinders and some form of lighter and "certainly wasn't sophisticated".
Police initially responded to reports of a vehicle on fire at the corner of Bourke and Swanston streets.
"A second person has been taken to hospital with a head injury".
Photo from the scene showed crowds of people behind police barriers.
Counter-terrorism police and intelligence officers are still piecing together how the incident occurred, but it is known the attacker drove a 4×4 truck loaded with gas bottles into the bustling city centre at around 4:00 PM (0500 GMT) on Friday evening.
"I thought the auto was coming for us", Ms Krug said.
Police said they were "not looking for anyone further at this early stage". "Nearly within a minute, Victorian Police officers were in attendance in an unmarked vehicle".
"They were around him trying to take the knife out of his hand-I'm pretty sure it was a kitchen knife", he said, according to Perth Now.
In a statement on social media, Australian Prime Minister Scott Morrison says, "Australians will never be intimidated by these appalling acts and we will continue to go about our lives and enjoy the freedoms that the terrorists detest".
Victoria state premier Daniel Andrews said the attack was "an evil and terrifying thing that has happened in our city and state today".
"It's the center of Melbourne, where a lot of the transportation changes over ... it's probably the busiest part of Melbourne and late on a Friday", said Meegan May who witnessed part incident from a nearby tram.
Events will take place this morning at the Shrine of Remembrance, while around the city, 100 buglers will line the streets of the CBD to sound the last post at 11:00am.
One of the victims succumbed to his injuries in hospital.
Police say the driver of a pickup truck got out of his vehicle, which then caught fire, and attacked three bystanders with a knife before being fatally shot by police on Friday in Melbourne, Australia's second-largest city.
Bourke Street Mall, a pedestrian strip and shopping area popular with foreign tourists including Japanese, was previously the scene of auto rampage in 2017 that left six people dead.