The Prahran mother woke before dawn on Monday to flashing police lights outside her home in Melbourne's inner south.
Officers had been patrolling after a recent spate of arson attacks at hospitality venues when they spotted two people on nearby Greville Street.
They followed the pair, dressed in hoodies and balaclavas, until they approached a stolen Mazda with three other people on board about 4.40am.
All five people - three males aged 16, another aged 19 and a 20-year-old woman - were arrested and two jerry cans of fuel were found in the car.
No charges have yet been laid but detectives are investigating possible links to a recent wave of attacks on licensed premises across the city.
The so-called "grog wars" have featured scores of venues being targeted by arsonists with links to organised crime.
For Ms Petrovic-Defteros, who witnessed the arrests from home, the incident is just another sign her suburb is on the front lines of a crime crisis.
"I'm just waiting for someone to be killed," she told AAP.
The parent launched the Reclaim Chapel Street movement, which has more than 400 members, to bring together residents concerned about a range of issues including crime.
"Everyone's on the same page, everyone's angry," she said.
Ms Petrovic-Defteros has become so used to local arson attacks, she has learned to identify them by smell.
"It's not like someone's having a barbie or anything like that, it's that toxic smoke," she said.
About an hour after the arrests, police were called to popular Chapel Street nightclub Electric Bar.
The venue was rammed by a white Mercedes about 5.40am and the area was left smelling strongly of petrol, police said.
Investigators believe the offenders may have been disturbed as they quickly fled the scene and the two incidents were not related.
Premier Jacinta Allan described the attack as "disgraceful behaviour that is not going to be tolerated".
"This behaviour that's been driven by organised crime that is targeting different parts of the community is the highest priority from Victoria Police," she told reporters.
Police have laid more than 140 charges and arrested 27 individuals in relation to ongoing attacks on Melbourne venues, Ms Allan said.
Gary Mann has lived near Chapel Street for 25 years and recently installed security cameras because of rising crime in the area.
The fellow Reclaim Chapel Street co-founder said the area had been in steady decline for decades.
"The footpaths are terrible, the graffiti is everywhere, they've just let the place go to the dogs," he said.
About five kilometres away, a family of five was forced to flee their home after two cars were set alight in their driveway in Caulfield North just before midnight.
The family escaped, although the fire had spread to the roof of the double-storey home, threatening neighbouring properties.
Police established a crime scene and have deemed the fire suspicious.
They have yet to confirm whether the incidents over the past 24 hours are linked.
Detectives from Operation Eclipse, launched days earlier to investigate the motives behind the targeting of hospitality venues, are investigating.
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