Bourke St rallies compete, mourners gather

By AAP Newswire

An anti-Islam rally and counter rally have traded barbs in central Melbourne before dispersing from opposite sides of Bourke Street where a deadly terror attack took place.

On one side members of the Australian Liberty Alliance addressed a small crowd about the dangers of Islam - the religion of the knife-wielding terrorist who stabbed three men, killing local shop owner Sisto Malaspina.

"Our political leaders have no courage whatsoever and we are getting sacrificed for the sake of political correctness," ALA president Debbie Robinson said.

Prominent ALA figure Avi Yemeni lashed out at the "mainstream media" for using terms like "lone wolf" and "mental illness" to describe terrorists.

"Stop exploiting a tragedy for your agenda," yelled a smaller number of counter protesters from across the road.

"Stop dividing us.

"Now is not the time for nationalism."

Police presence was strong given the small numbers on each side, as officers stood in lines on either side, like a barrier between the groups.

Meanwhile, a few hundred metres up the street, a sombre crowd gathered outside Pellegrini's Bar, co-owned by stabbing victim Sisto Malaspina.

A pile of flowers and cards is growing outside the bar and people have been writing condolence notes and pausing to pay their respects.