Australia's Prime Minister says the self-styled sheikh behind an 'appalling and ugly' siege at a Sydney cafe was "deeply disturbed."

"This has been an absolutely appalling and ugly incident. That's the only way to describe it, an appalling and ugly incident. Our hearts go out to the families of Katrina Dawson and Tori Johnson. These were decent, good people, who were going about their ordinary lives. It's about as innocent a thing as anyone can do to go and grab a cup of coffee before the working day has fully started. Decent, innocent people who got caught up in the sick fantasy of a deeply disturbed individual," he said.