A 20-year-old man is in custody after a five-hour manhunt that began when police responded to reports a man allegedly entered a home in Bega armed with a knife.

NSW Police released a statement shortly after 9.30pm confirming a woman had died from her injuries.

“An extensive search began about 3.30pm today after a man and a woman were stabbed at a home in East Street, Bega,” it said. Bega is a 2.5-hour drive south of Canberra.

“The woman died and the man remains critically ill. He has since been airlifted to a Sydney hospital.

Police say after stabbing the pair, the man carjacked a vehicle and seriously assaulted the male driver before taking off.

Officers from the South Coast Police District responded and conducted a search for the man. He was arrested near Sapphire Coast Drive at Bermuda and taken to Bega Police Station for questioning.

Residents were urged to remain vigilant while the manhunt was taking place.

A witness told the ABC earlier on Friday that the victim of the carjacking was lying on the road “heavily bleeding” from a head wound.

When police stopped him, he was told “turn back and (do) not stop for anyone, lock the car doors and keep going”.