A man has been arrested during a gun-related police operation in Port Kembla.
Police raided the Simpson Sports firearms and hunting specialist store, on the corner of Wentworth and Fitzwilliam streets, about 8.30am on Wednesday.
The Mercury has been told the firearms dealer was arrested as he opened the gate to begin the day's trade.
The 46-year-old man was taken from the shop and is being questioned at Lake Illawarra police station.
However, a number of police - including detectives and specialist officers - remain at the business, which has been declared a crime scene.
The NSW Police State Crime Command is leading the investigation, assisted by police from the firearms registry.
Police have remained tight-lipped about the exact nature of the operation, saying only that it relates to an ongoing investigation by the police force's drug and firearms squad.
The Mercury understands the dealer has been stripped of his firearms licence, and hundreds of guns are in the process of being seized by police.
As of 2.30pm, it was understood just 31 of about 340 guns had been removed from the business.
The shop is expected to remain a crime scene into the evening, as police continue to process the firearms.
Police have said the operation remains ongoing and no further information was currently available.
More details about the investigation are expected to be provided when police address the media on Thursday.
Meanwhile, two people who arrived at the shop trying to buy guns on Wednesday morning were met by police officers at the door and turned away.