Police in Australia say they have foiled an Islamic State-inspired plot to carry out an attack at a World War One centenary event. Photo: BBC NEWS

Police arrested five teenage suspects, charging one 18-year-old with conspiring to commit a terrorist act.

The men were planning to target police at an Anzac memorial event in Melbourne next week, police said.

About 200 police officers took part in the counter-terrorism operation in the city early on Saturday.

Acting Deputy Police Commissioner Neil Gaughan told reporters that evidence suggested the suspects had been influenced by Islamic State.

One of the men, Sevdet Besim, appeared briefly in Melbourne Magistrates Court on Saturday.

Police say a second man held on terrorism-related offences is also likely to be charged.

A third man, also 18, was arrested on weapons charges and two other teenagers, aged 18 and 19, were in custody and assisting with inquiries.

Officials referred to possible attacks using "edged weapons", but Mr Gaughan said there was no evidence to suggest there was "a planned beheading".

The men were "associates" of Abdul Numan Haider, a teenager shot dead in September after he stabbed two officers, police said.

Anzac Day is an annual day of remembrance for servicemen and women from Australia and New Zealand. A series of events are planned for next week to coincide with the 100th anniversary of the landings at Gallipoli, Turkey.

'Not people of faith'

Australian Prime Minister Tony Abbott urged people to turn up to memorial events as planned.

"The best thing we can do to counter terrorism... as individuals is to lead normal lives," he said, adding that the authorities were doing everything possible to keep people safe.

Tony Abbott urged people to continue their plans as normal

Police said that although officers were the primary target of the alleged plot there was also a threat to the public.

Search operations were continuing at several addresses in the south-east of the city on Saturday.

The premier of Victoria, Daniel Andrews, said the police presence at Anzac Day events would be "significantly increased".

"These individuals arrested today are not people of faith, they don't represent any culture," he added.

"This is not an issue of how you pray or where you were born... this is simply evil, plain and simple."

Australia raised its threat level to high last September and has since carried out a series of counter-terrorism raids.