Police said a 21-year-old Sydney man had no known links to terror organisations, but he did have a thumb drive with details of mass-casualty white-supremacist attacks in the United States and New Zealand.
Paramedics found a woman with a stab wound taking refuge in a nearby hotel.
Luke said he arrived to find four men on top of the suspect and helped to pin him down with a chair and a crate.
"It is too early to determine whether there were any injuries", spokeswoman said as quoted by the 7NEWS.com.au.
Video footage shows the man, who was armed with a large butchers knife, yelling "Allahu Akbar" on Sydney's streets.
Videos posted online show a man running through the streets brandishing a knife, before people attempt to stop him and eventually tackle him to the ground.
Police said the suspect - a 21-year-old man from Maryong in New South Wales - attempted to stab several people before being arrested.
The incident took place near King and York Street in the Sydney CBD after 2pm on Tuesday afternoon.
Another woman, aged 41, was stabbed in the back in the street and has been taken to hospital where she is in a stable condition.
Luke, a professional Thai kick boxer, told the BBC: "I was sat at my desk and heard a massive scream outside".
The driver of an Uber has described the terrifying moment the knife-wielding man jumped on top of his vehicle.
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I saw already like "six weeks" and stuff like this, but Ali was not a lot injured in his career. I didn't speak to (goalkeeping coach) John Achterberg yet about that.
"These people are heroes, and I want to acknowledge that", he told the newspaper. They were significantly fearless people ...
Prime Minister Scott Morrison said on Twitter that the violence was "deeply concerning" and praised the people who restrained the assailant.
"They were courageous, and and i can only use that word seriously, they were significantly fearless people.
As the investigation continues, we will reassess that", Fuller said, adding "there is no information we are looking for any other offenders". They approached a person with... clear evidence of a stabbing previously.
The man, who appeared to be caucasian and aged in his 20s, then fled on foot and attempted to stab "a number" of other people, police allege.
"The cops are here and they blocked the road right now, so we can't go outside".
"The attacker is now in police custody following the courageous actions of those who were present at the scene and were able to ... restrain him", Morrison said.
The woman's body was discovered with a slit throat, police confirmed to multiple news outlets.
"Our thoughts are with all those who have been impacted by this violent attack".
"A number of crime scenes have been established", a spokesperson said.