Police have arrested a man wanted over a fatal car accident at Albion Park Rail.
Detectives swooped on the man on a Figtree oval just before 11am on Thursday.
A nearby resident called the Mercury after seeing the chase come to an end.
"They tried to drive straight across the paddock but there was a creek," she said.
"They went straight into it. They all jumped out, then the four of them ran over towards our houses.
"One was hiding behind a house just behind me ... but they got him."
Figtree resident Wal Burkinshaw said one of the suspects was arrested in his backyard.
"I heard the back gate bang, which was pretty unusual as there was nobody out on the back deck, and I thought that was weird," Mr Burkinshaw said.
He said he went outside to investigate and a police officer told him to go back inside the house.
"More and more police came and then there was a hell of a commotion," he said.
Mr Burkinshaw said the arrested man damaged part of his fence and rainwater tank.
It's understood three people were arrested and taken to Lake Illawarra police station.
One of those people is believed to be Darren Butler, one of three people police were looking to speak to as part of the investigation into the crash at Albion Park Rail that killed Daniel Merrett earlier this month.
Merrett, 27, died when the car he was a passenger in was travelling along the Princes Highway at Albion Park Rail and crashed into the rear of a petrol tanker.
Three other people in the car were also injured.
Police inquiries suggested the car may have been pursued by another vehicle at the time of the accident, and shots may have been fired.
As part of the investigation, police had been looking for three people - 34-year-old Andrew Russell, 25-year-old Holly Green and 27-year-old Butler.
Russell has since been arrested and charged with murder, armed robbery and assaulting police in the execution of their duty.
Police are still looking to speak to Green.
Anyone with information is urged not to approach her but call Crime Stoppers on 1800 333 000.
It is understood a local school was placed into lockdown due to the incident.
- With Ashleigh Tullis