Witness describes encountering knife-wielding attacker in Sydney

A British man has recounted the moment a knife-wielding man struck in Sydney's CBD.

Police have arrested a 21-year-old after one woman was found dead in her apartment, and another was attacked at random.

Paul O'Shaughnessy told reporters the scene was chaotic.

"We ran out and we kinda saw some blood on the floor, whatever on the street, so we were like 'oh my god this is pretty serious'.

"Then everyone was on the other side of the road clearly in distress and was like 'where's he gone, he's run that way.'"

A man stands in the middle of the road holding a knife.
The man behind the stabbing. Photo credit: 7News

The group soon spotted the man and O'Shaughnessy's brother Luke managed to restrain him.

"My brother, he was the hero. He got a grip of him, along with another guy we don't know, and put a crate on his head. He was just mumbling religious things."

A man on the ground covered in chairs.
The man on the ground. Photo credit: 7News

The attacked woman is recovering in hospital, while the body of the woman killed has now been removed from the apartment.

It's believed the dead woman was a sex worker who operated from her home.