Melbourne CBD devastation: What led to three lives lost.

A child is among three people killed after a driver deliberately ploughed into pedestrians in Melbourne’s CBD on Friday afternoon.

A further 15 people were injured in the incident, which police have confirmed was not terror-related.

A 26-year-old man is in custody.

Speaking to the media this afternoon, Chief Commissioner Graham Ashton of Victoria Police said that the man was observed performing “burnouts” on the corner of Swanston and Flinders Street at around 1:45pm, before turning into Bourke St Mall where he deliberately hit pedestrians “at speed”.

Those fatally struck were a man and woman aged in their thirties and a young child. Police do not believe they are related.

The driver was later arrested on Bourke St following an air and ground pursuit that culminated in the offender's vehicle being rammed by police.

Chief Commissioner Ashton confirmed that officers shot the suspect in the arm, resulting in non life-threatening injuries.

He said the man is known to police due to an "extensive history" of family-violence-related assaults.

Among those injured are four children, who are currently being treated at the Royal Children's Hospital Melbourne. One of them is an infant, who is in a critical condition.

"Police ended up taking that child to hospital in the police car because we couldn't wait for the ambulance to arrive such was the condition of the child," Chief Commissioner Ashton said this afternoon of the young victim.

RCH is among a number of Melbourne hospitals to have enacted Code Brown, which refers to an external event that has the potential to overwhelm hospital resources.

"Where's my baby?"

There are reports from witnesses that a pram was struck during the incident and a baby thrown beneath the vehicle.

Christine Nixon, a former police commissioner, was on the scene and said a woman told police she could not find her child, reports news.com.au.

“She kept asking me 'where's the baby?' and I don't know," said Nixon.

"People were just crying and screaming."

People have reported screaming and running for their lives as the car sped toward them.

A witness told Mamamia, "I was just standing outside Cotton On [on Bourke St] and everyone started screaming saying like, 'Move, move'. Everyone just automatically moved to the side, and all of a sudden a red car came straight through and hit about seven or eight people. No slowing down.

"It was definitely a car chase because the police were straight up behind. There's one girl that's on the floor, I was literally like one minute away from getting hit, and there was a little boy in front of me who was so close too.

"There's a lot of people hurt, I'm shaking."

One woman, named Amanda, told Mamamia she witnessed the moment a car came hurtling towards shoppers in Bourke St Mall.

"I was on a tram coming down Bourke St into the city. I got off, looked to my left and a car was coming towards me at a million miles an hour. People were just running everywhere. I bolted into H&M and called my husband. I started to think about whether it was safer to stay in a crowded department store or try to get back to my office," Amanda said.

She said her mind instantly thought back to the recent vehicle attacks in Nice and in Berlin.

"I just thought straight of the worst possible scenario," she said. "Cops were trailing behind the car. It was scary. Absolutely terrifying. People were just crying and screaming."

A Mamamia reporter on the scene saw one of those injured also.

"I saw a woman down on the ground out the front of the Commonwealth Bank on the corner of Bourke St and Elizabeth St.

"She was lying face down, with blood dripping onto the floor, from the head area. There was a crowd of people around her."

Another Mamamia reporter who lives near Bourke St Mall said she had been forced to remain indoors after the incident occurred.

"I just tried to leave my apartment and they won't let anyone out," she said earlier.

"Staff are telling guests and residents the building is on lock-down following police orders, no one is allowed to leave."

Premier David Andrews: "Our hearts are breaking."

Premier David Andrews this afternoon said he was "very proud" of the way emergency services and bystanders had responded to the crisis.

"Our hearts are breaking this afternoon that a number of people have died. Others remain in a critical condition, very, very seriously ill, gravely ill in hospitals around our city," he said.

"We, through our response, through the work of our emergency services, through the instinctive way in which Victorians have reached out to support each other, we can be confident that we are stronger than this evil criminal act."

The Lord Mayor of Melbourne, Robert Doyle, earlier expressed his sympathy for the victim's loved ones.

"Many families have been devastated today in a vicious and deliberate act of violence," he wrote on Twitter. "Our thoughts are with the victims and their families."

The area around Bourke St Mall remains closed as investigations continue.

Victoria Police have urged any victims and witnesses requiring support to call the Victim's Support Helpline on 1800 819 817.