The New South Wales (NSW) police have shot dead a man following a confrontation at Sydney's Central station.

The incident happened near a florist's shop on Eddy Avenue. The NSW police said officers were called to the site around 6.45pm (8.45am GMT) after the owner of the flower shop was targeted by the man – identified as Danukul Mokmool.

"He grabbed me from behind ... he was breaking everything inside," the florist Manuel Theoharas said, adding the 30-year-old was armed with up to four pair of scissors and a broken bottle.

"The way he was holding the broken bottle he could cut my neck or... anything. He said to me: 'Don't move, call the police," Theoharas added.

An investigation into the case has been launched and it was believed that the attacker was a Thai national.

Police acting assistant commissioner Mark Walton, said: "A critical incident investigation has commenced following the death of a man during a confrontation with police.

"The homicide squad will now investigate all the circumstances surrounding the incident, including the discharge of police firearms during the confrontation with the man."

People who witnessed the incident said Mokmool was screaming and behaving erratically when he ran from one of the platforms to the florist shop.

Sami Aryal, who works nearby, said there were some officers around the flower shop who were asking someone to put his hands down.

"One of the policemen went inside the shop ... and as soon as a man was about to run, I saw the policeman shooting him. He was shot and he was straight to the floor," she said.

Another witness who also owns a shop nearby said he heard three shots and screams. "Then after, the three police and one medical staff guy from the station surrounded him," Salim added.

Police have said the incident was not terrorism-related and appealed more people to come forward to testify.