Witnesses have described how a 22-year-old Sydney man shouted Islamic slogans and said he wanted to be killed by police after stabbing a stranger in a terror-inspired attack.

Ihsas Khan has been charged with attempted murder and terror offences after knifing 59-year-old Wayne Greenhalg in the south-western Sydney suburb of Minto.

Mr Greenhalg is in a serious condition in hospital on Sunday after sustaining wounds to his body and hands.

Prime Minister Malcolm Turnbull drew similarities between the Minto attack and the 9/11 terrorist attacks in the United States 15 years ago.

“On one level, they seem very different. But connecting them both is a violent Islamist ideology which perverts the religion of Islam and seeks to destroy and threaten our way of life,” Mr Turnbull told media.

Mr Khan was denied bail in a Parramatta court and is due to reappear in court on Wednesday.

“We will be alleging before court that this was an act inspired by ISIS, it was a deliberate act, it resulted in a person receiving extremely serious injuries,” NSW Deputy Police Commissioner Catherine Burns told a media conference.

Mr Greenhalg was attacked in a local reserve before seeking shelter in a nearby hair salon.

Andrew Horton, the husband of the salon owner, told ABC his wife’s actions helped save Mr Greenhalg after another neighbour also intervened.

“My neighbour’s come home, just a freak of timing, he’s come home at exactly the right time from his son’s football game,” Mr Horton said.

“[He] saw that the attacker had a knife, [he] got out of the car and threw the door open, and it sort of blocked the bloke a bit, apparently.”

The hair salon where Wayne Greenhalg sought shelter.

Mr Horton did not witness the incident but said his wife told him the Mr Greenhalg sought shelter in her salon while she was inside.

“She’s seen that he’s been knifed, she saw the blood pouring out of him, and seen that the fella’s not far behind him … but she’s had the sense to lock the door,” he said.

Mr Horton said Mr Khan tried to break the glass door of the salon, but it held and police arrived a short time afterwards.

He said Mr Greenhalg is married and has three children.

Mr Khan is known to police, but not for links to any known terror groups, Ms Burns said.

“We know that this person has strong extremist beliefs inspired by ISIS,” she said.

“[He is] not someone who was front and centre in our work at the moment. We don’t believe he was connected with any terrorist group. This is the challenge.”

NSW Dep. Police Commissioner Catherine Burn confirms 22-year-old man charged with committing act of terror in #minto https://t.co/GSxmwHUhvs

— ABC News (@abcnews) September 11, 2016

Ms Burns said Mr Khan also attempted to attack police who arrived at the scene after he allegedly tried to stab an officer through a car window.

News Corp reported that another neighbour, Sivei Ah Chong, was forced to repeatedly hit Mr Khan on the head with a plank of wood to defend Mr Greenhalg.

Wayne Greenhalg remains in hospital following the attack. Photo: Facebook

Mr Ah Chong’s son, Derek, was quoted as saying Mr Khan was in a crazed state and kept trying to attack his family and Mr Greenhalg after being repeatedly hit in the head with a piece of timber.

“My dad kept saying to him ‘drop the knife or I will hit you’ and he [Khan] just said ‘Do it, I want you to do it’,” Derek Ah Chong said.

“Then my dad grabbed the piece of wood he had used before and smashed him over the head again and he backed off then and he looked a bit dazed.”

“He then started yelling ‘call the police, call the police, I want them to come and shoot me I want to die today’.”

Mr Turnbull, speaking on the 15th anniversary of the 9/11 attack, said another connection between the Sydney incident and the attack on the World Trade Centre, was the heroism of members of the public at the scenes of both events.

.@TurnbullMalcolm responding to the alleged terror attack at Minto in Sydney https://t.co/8yfmHkQVWF

— Sky News Australia (@SkyNewsAust) September 11, 2016

Attorney-General George Brandis earlier paid tribute to police officers as well as members of the public who helped the victim at the scene.

“It may very well be but for the bravery of those citizens, who intervened, the victim’s life would have been lost,” Senator Brandis said.

The Federal Government will introduce two new pieces of anti-terrorism legislation this week. Photo: AAP

The federal government will introduce two new pieces of anti-terrorism legislation to Parliament this week.

The first will see the introduction of control orders for offenders as young as 14 years old, while the other will allow authorities to detain convicted terrorists who have finished their sentences if they are deemed to be a risk to the community.

-with ABC