At least 12 people have been killed and 29 others injured in a mass shooting at Bondi Beach in Sydney, with authorities confirming the attack has been declared a terrorist incident.

Emergency services were called to Campbell Parade shortly before 7pm  after reports of multiple gunshots near the beachfront.

Police confirmed two male gunmen opened fire from a bridge overlooking the area where people had gathered.

One gunman was shot dead by police at the scene.

The second alleged shooter was taken to hospital in a critical condition and remains under police guard.

NSW Police said 29 injured people were transported to hospitals across Sydney.

Several victims remain in serious and critical condition.

During subsequent searches, police located improvised explosives inside a vehicle linked to one of the alleged shooters.

Specialist officers secured the items and an extensive exclusion zone was established around the area.

NSW Premier Chris Minns said the attack was targeted at the Jewish community and confirmed police had classified the shooting as a terrorist incident under state legislation.

Prime Minister Anthony Albanese also confirmed the attack was being treated as terrorism and said federal agencies were working alongside NSW Police as part of a joint investigation.

Police said there were no reports of further connected incidents elsewhere in Sydney at this stage. A multi agency operation remains underway, with forensic examinations continuing through the night.

Authorities have appealed for anyone with relevant mobile phone or dashcam footage from the area at the time to contact police as investigations continue.