'History of drug use': Police identify 32-year-old man as alleged Melbourne driver

The man allegedly behind the wheel of the vehicle that ploughed into pedestrians in Melbourne's CBD has been identified.

The incident unfolded on Flinders Street shortly after 4.30pm as a white 4WD mowed down pedestrians, injuring 19, with four critical including a four-year-old boy and an 83-year-old man.

Victoria Police identified the driver as a 32-year-old Australian citizen of Afghan descent. Police confirmed he was the sole person in the car.

He was previously known to police with a history of drug use and assault matters.

The 32-year-old also has a history of mental health issues and police believe he has been receiving treatment for his mental illness.

He is one of the 19 hospitalised and is in a stable condition, remaining under police guard.

Another male, aged 24, who police believe was not related to the incident, was also arrested at the scene.

According to police, he was seen filming the incident with his mobile phone and was in possession of a bag containing three knives.

Fifteen people are in a stable condition in hospital and four are in a critical condition.

The two men are yet to be charged, and while police said it was too early to comment on whether the incident was terrorism-related, they have said they believe it was a deliberate act.

“We believe based on what we have seen that it is a deliberate act," Commander Russell Barrett told reporters.

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"The motivations are unknown, it is still the early days of the investigation."

During a press conference on Thursday evening, Victorian Premier Daniel Andrews said the incident was an "act of evil" and "cowardice".

"We are all caught up in this. We are all deeply saddened and deeply wounded by this terrible act," he told reporters.

The incident comes just 11 months after six people were killed in a similar incident in nearby Bourke Street.

Among those rushed to hospital was a four-year-old boy who suffered serious head injuries but remains in a stable condition.

The oldest confirmed victim is an 83-year-old man whose condition is unknown.

The other victims range in age from 25 years old to 58 years old.

An off-duty police officer, credited with restraining the driver, was also hospitalised.

Premier Andrews praised his quick-thinking actions in the face of adversity.

"I think we would be right to single him out for special praise for the way in which he instinctively came to the aid of others," he said.

Witness Jim said the 4WD was travelling west along Flinders Street at up to 100km/h.

"The intersection was full of pedestrians and he just ploughed through," he told ABC TV.

"The only thing that slowed him down was him hitting pedestrians."

Paul Cahalane, 25, was walking to the Coles supermarket on Elizabeth Street when he heard a "bang".

"The first thing I saw was people sprinting in separate directions, saying 'bomb' and this and that," he told AAP.

"Straight away I saw about five or six people on the floor."