The victim of an attack in Sydney in which a knife-wielding man was wrestled to the floor by three British men has been named as Michaela Dunn, 24.

Ms Dunn was allegedly stabbed in a block of flats in the central business district (CBD) of Sydney.

Police said she had sustained a laceration to her neck and was pronounced dead at the scene.

Ms Dunn’s body was found after the nearby arrest Mert Ney, a 20-year-old suspect who police said had a history of mental health issues.

Dramatic footage shows Mr Ney running around the CBD, brandishing a foot-long kitchen knife. 

He appears to shout "Allahu Akbar" and "shoot me, f—ing shoot me in the f—ing head, shoot me, I want to f—ing die”.

The 24-year-old's body was found close to where a man was arrestedCredit:
Michaela Dunn

Police detained Mr Ney after he was wrestled to the floor by three British men, named "heroes" by New South Wales (NSW) Police Superintendent Gavin Wood.

The trio held the man to the floor with chairs and a milk crate.

Police confirmed Michaela Dunn as the alleged victim in a brief statement. 

"While her family appreciate the support offered by the community, they have requested their privacy at this difficult time," it said.

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"The investigation into the circumstances surrounding Michaela’s murder is being led by detectives from the Homicide Squad under Strike Force Lalchere."

Michaela Dunn's mother described her as a 'beautiful, loving woman'Credit:
Michaela Dunn

Ms Dunn’s mother told Nine News she was a "beautiful, loving woman who had studied at university and travelled widely."

Ms Dunn was a former student of Rosebank College in Five Dock and the University of Notre Dame, and she had a sister.

Her social media accounts showed her travelling to Las Vegas and Sri Lanka, but have now been deleted.

Ms Dunn has been identified as a sex worker, and a joint statement has been released by three Australian sex work associations about her death. 

Ms Dunn had recently travelled to Las Vegas, her Instagram showedCredit:
NSW Police/AFP

It highlights the "barriers to accessing justice and reporting crimes against" sex workers, and asks that Ms Dunn is portrayed as a "whole individual and family and community member who will be deeply missed and mourned".

Mr Ney remains in police custody, after being treated for a laceration to his knee.

NSW police said they had recovered a mobile phone and USB stick during a search of his person, and seized electronic devices following other searches.