The self-proclaimed leader of international hacking group Lulz Security, or LulzSec, has been arrested in Sydney by Australian Federal Police.

The 24-year-old man is a senior Australian IT professional who works for the local arm of an international company with access to information on government clients.

He has been charged with two counts of unauthorised modification of data to cause impairment and one count of unauthorised access to a restricted computer system.

LulzSec is an offshoot of the hacking group Anonymous.

LulzSec was formed in 2011 and quickly grabbed headlines after claiming responsibility for a series of high-profile cyber attacks against the CIA, Sony Pictures, the US Public Broadcasting Service and Britain's Serious Organised Crime Agency.

Several members of the group have been arrested in recent years, including its leader, known as Sabu.

Sabu turned out to be FBI informant Hector Xavier Monsegur, who federal officials said helped them build a case against several other hackers.

Two weeks ago, British LulzSec hacker Ryan Ackroyd pleaded guilty to several cyber attacks.

Australian Federal Police Superintendent Brad Marden said the man arrested hacked into an Australian government website and defaced it earlier this month.

Mr Marden would not say what website was attacked, but said it did not belong to a federal agency.

Police do not believe any sensitive data stored on the site was accessed in the attack, and do not believe anyone else was involved in the hack.

The man, from Gosford, about 80km north of Sydney, claimed to be the Australian leader of LulzSec, Australian Federal Police Commander Glen McEwen said.

But Anonymous Australia appeared to laugh off those claims on Twitter.

Police began investigating the man two weeks ago after they discovered the government website had been hacked.

"This individual was operating from a position of trust who had access to sensitive information from clients including government agencies," Mr McEwen said.

"The AFP believes this man's skill sets and access to this type of information presented a considerable risk for Australian society."

The man was released on bail and ordered to appear in court next month.