The man, who's yet to be formally identified, was shot at a bottle shop in Park Orchards about 9pm on Sunday.
Victoria Police detectives were in the area investigating a number of armed hold-ups when they reportedly happened across the attempted robbery.
It's believed the man was pointing his weapon at the bottle shop attendant, prompting police to open fire.
"One of the investigators involved took immediate action because he was very concerned about the firearm threat to the single attendant that was working in the bottle shop," Victoria Police Deputy Commissioner Ross Guenther told
reporters.
A witness, who uploaded photographs of the scene to Twitter, said he heard five or six shots fired.
"Someone is not going home tonight," Michael Featherston tweeted.
The homicide squad and the professional standards unit are investigating the incident.
