Two men were charged in Australia after police thwarted an "imminent" attack, seizing a home-made Islamic State of Iraq and the Levant flag, a machete and a video detailing the alleged plot during a raid in Sydney.
The men, aged 24 and 25, were arrested in the suburb of Fairfield and would have carried out the attack on Tuesday if they had not been caught that day, Catherine Burn, the New South Wales state Deputy Police Commissioner, told reporters.
She said the planned attack was "consistent with the messaging coming out of IS", referencing to the group's alternative name.
"We will allege that both of these men were preparing to do this act yesterday," said Burn. "We built up information; we received further information which indicated an attack was imminent. And we acted."
New South Wales state Premier Mike Baird described the plot as "beyond disturbing".
The men were identified as Omar Al-Kutobi and Mohammad Kiad and were charged with "undertaking acts in preparation or planning for a terrorist act". The offence carries a maximum punishment of life in prison.
Their lawyer did not apply for bail and it was formally refused during a brief court hearing on Wednesday, reported the Associated Press news agency. Neither man appeared in the courtroom.
The Arabic-language video that was seized during the raid showed one of the men making threats, though Burn declined to detail exactly what was said.
George Brandis, Australia's attorney general, later told the Senate that the video depicted one of the suspects kneeling in front of the ISIL flag with the knife and machete while making a politically motivated statement and threatening to commit "violent acts" with those weapons.
The men planned to launch their attack in western Sydney, he said.
Asked whether they were planning a beheading, Burn replied: "We don't really know what act they were going to commit."
Police were trying to determine whether the men were in contact with anyone from ISIL.
Prime Minister Tony Abbott said he suspected the threat in Australia was going to only worsen.
"As we have seen again and again in recent times, the death cult is reaching out all around the world, including here in Australia," Abbott told Parliament.
"There are people in this country who are susceptible to these indictments to extremism and even terrorism."
ISIL has captured swathes of territory across Iraq and Syria and attracted in increasing numbers of Australians to its cause.