Two friends charged with plotting an Islamic State terrorist attack in Sydney recorded a chilling video vowing to stab the kidneys and necks of a white person.

Prime Minister Tony Abbott revealed details about the video in Parliament on Tuesday in a potentially prejudicial move that attracted criticism from senior terrorism police.

Counter-terrorism officers raided the Fairfield home of Omar al-Kutobi, 24, and Mohammad Kiad, 25, on Tuesday in an 11th-hour bid to thwart an Islamic State-inspired killing later that day.

They allegedly seized a hunting knife, machete, homemade Islamic State flag and a video message about committing a terrorist act similar to those of the Islamic State. 

Further details of the video emerged on Thursday as police started to build a better picture of pair, who were unknown to authorities before the raid on Tuesday.

Fairfax Media has been told the video does not mention any police or military objectives, only a reference to targeting generic Anglo-Saxons.

Kiad filmed the video and al-Kutobi starred, kneeling in front of the poorlypainted Islamic State flag and speaking in Arabic, saying an attack would happen "today".

Mr Abbott took the unusual step of reading out parts of the video message to Parliament on Thursday, following a briefing with security agencies.

Mr Abbott quoted al-Kutobi as saying: "I swear to almighty Allah we will carry out the first operation for the soldiers of the caliphate in Australia. I swear to almighty Allah, blond people, there is no room for blame between you and us. We only are you, stabbing the kidneys and striking the necks."

Police sources later told Fairfax that a translation of the Arabic message revealed a generic reference to white people being the target, rather than any specific location or person.

The Arabic phrase can be interpreted as blonds or Anglo-Saxons.

A high-ranking counter-terrorism officer said they had no idea Mr Abbott would reveal so much detail about the video and that it could potentially prejudice the court case.

NSW Bar Association president Jane Needham, SC, said if the matter went to trial, the court might find it "impossible" to empanel a jury unaffected by the comments.

"That could even mean the men would not receive a fair trial because the jury has already made up its mind," she told ABC Radio on Friday.

On Thursday, a spokesman for the Prime Minister said Mr Abbott quoted the translation with the prior consent of the Commissioner of the Australian Federal Police, Andrew Colvin.

Mr Abbott described the contents of the video as "monstrous extremism".

"I don't think it would be possible to witness uglier fanaticism than this, monstrous extremism than this," he said.

Mr Abbott said Australia needed its security agencies more than ever as it faced a rapidly evolving threat.

"Under the influence of the Islamist death cult, all you need to be a terrorist is a knife, a flag, a camera phone and a victim. That's all you need," he said.

"We must defeat this threat and I am confident that this government has the will to do so."

Commonwealth prosecutor Kay Marino said the video would be shown when al-Kutobi and Kiad made an application for bail in Central Local Court next month.