Sydney siege: Tony Abbott says Sydney gunman Man Haron Monis was not on security watchlists

Prime Minister Tony Abbott has revealed the gunman responsible for the Sydney siege was not on a security watchlist, despite his long criminal history and known "infatuation with extremism".

Self-styled Iranian cleric Man Haron Monis was killed about 16 hours after taking 17 people hostage at the Lindt Chocolate Cafe on Monday morning.

Two hostages, Lindt cafe manager Tori Johnson, 34, and barrister Katrina Dawson, 38, were also killed.

Mr Abbott flew to Sydney on Tuesday afternoon after convening a meeting of the powerful National Security Committee of Cabinet Tuesday morning.

Standing alongside New South Wales Premier Mike Baird and Australian Federal Police Commissioner Andrew Colvin, Mr Abbott described Monis as a "deeply disturbed individual" who was "consistently weird".

"How can someone who has had such a long and chequered history, not be on the appropriate watchlists?" he said.

"And how can someone like that be entirely at large in the community?

"These are questions that we need to look at carefully and calmly and methodically, to learn the right lessons, and to act upon them."

Mr Abbott said the man was well known to the NSW Police, the AFP and the domestic spy agency ASIO and said it was reasonable to ask whether the incident could have been prevented.

"Even if this individual, this sick and disturbed individual, had been front and centre on our watchlists, even if this individual had been monitored 24 hours a day, it's quite likely, certainly possible, that this incident could have taken place, because the level of control that would be necessary to prevent people from going about their daily life, would be very, very high indeed," he said.

Mr Baird echoed Mr Abbott's comments.

"We are all outraged that this guy was on the street. We are. And we need to understand why he was," he said.

"We also need to understand why he wasn't picked up and we'll be working closely with the Federal authorities together with our own agencies to ensure what we can do better.

"[The] community has every right to feel upset. I'm incredibly upset. I'm outraged and we need to ensure that everything is done to learn from this."

PM says 'most difficult 36 hours' in Sydney's history

Mr Abbott has described the siege as an "absolutely appalling and ugly" incident and said it has been one of the most difficult periods in Australia's history.

"This is an incident which has echoed around the world," he said.

"Tens if not hundreds of millions of people right around the world have been focused on the city of Sydney which has been touched by terrorism for the first time in more than 35 years."

Mr Abbott thanked and congratulated the New South Wales Police for the commitment and professionalism they showed.

"Everyone has been impressed by the speed of the NSW response, the thoroughness of the preparations they made and the professionalism of the action they took once it became obvious that people inside the cafe were being taken out by this deluded and sick individual," he said.

"I think every Sydneysider can feel quietly proud of the way this city has handled one of the most difficult 36 hours in our history.

"People have gone about their business and in the aftermath of the end of the siege last night, people have responded with typical Australian decency and generosity and the spontaneous shrine which has developed now in Martin Place is so much an expression of the innate goodness and decency which is a mark of the Australian character."

Mr Baird has also thanked Sydneysiders for their handling of the incident.

"This city is amazing," he said.

"Its people are incredible, and what you are seeing in Martin Place right now as it unfolds, it is almost as if a beating heart of the city is being put in place.

"That's what those flowers represent to me. It is showing us that this city is alive. It is beating. Despite the challenges, despite the tragedies we have endured, it is people saying they care," he said.

Mr Abbott has pledged to do whatever is humanly possible to keep the community safe and has used the event to highlight the need for the next round of proposed national security laws, that would force telecommunications companies to hold their customer's data for up to two years.