Investigators dressed in full protective gear were observed rifling through garbage at the scene and removing items from at least one apartment.
One local resident told CNN he had never seen anything like it in his neighborhood.
While Australian media was abuzz with theories around the type of the terror device, Australian Federal Police (AFP) commissioner Andrew Colvin said there were no official details had been released as yet.
"The plot that we are investigating we believe was an attempt to put a device onto an aircraft, but beyond that the speculation is just that -- it's speculation," Colvin told a press conference Monday.
A report in local newspaper The Australian
said the plan involved "constructing an explosive device ... that would kill the occupants of a plane with poisonous gas." The AFP would not confirm or deny the report and Minister of Immigration Peter Dutton told Australian media: "I don't want to go into the detail" when asked about the possibility of such an attack.
Experts told CNN that it would be difficult to get such a device on a plane.
Australian Prime Minister Malcolm Turnbull told ABC radio the plot was "advanced," but wouldn't comment any further.
Raids in 4 suburbs
The raids followed searches in four different Sydney suburbs on Saturday
, including Lakemba, Surry Hills, Wiley Park and Punchbowl.
A 39-year-old man was treated in Sydney's St. Vincent hospital following the Saturday raids, the hospital confirmed to CNN, but they wouldn't say if he was one of the suspects.
Late on Sunday, police said they had been granted a special seven-day extension in the New South Wales Magistrates Court to continue interrogating the four suspects without pressing charges.
"It should be noted that the presumption of innocence applies to these person," AFP said in a statement.
News of the arrests was first announced on Saturday, in a press conference fronted by Colvin and Turnbull, who described the plot as an "elaborate conspiracy."
"The operation is continuing. At this stage, four people have been arrested and a considerable amount of material has been seized by police," Turnbull said Saturday.
Colvin said the plotters had been intending to use an "improvised device" to bring down a plane, although he wouldn't elaborate on what type of device it was.
The commissioner said the terror plot was Islamist-inspired but wouldn't link it to any particular terrorist group.
"Exactly what is behind this is something that we will need to investigate fully," Colvin said.
Airport security tightened
Extra security measures have been put in place at Australian airports since the planned attack was thwarted, authorities said.
In his Saturday briefing, Colvin would not elaborate on what the new security measures were, but warned terrorists were becoming more "ingenious."
"What people can expect is there's an increased police and security agency presence. You can expect longer delays to make sure that more screening is being done on baggage," he said.
Despite a few delays during peak period on Monday morning, Sydney Airport has generally been operating smoothly despite the new measures.
Australia's terrorism threat level remains in the middle at "probable," the Prime Minister said, between "possible" and "expected."
"The number one priority of my government, and my commitment to the Australian people, is to keep them safe," he said.
The arrests come a month after ISIS claimed responsibility for an attack at a suburban Melbourne apartment building, where one man was killed and three police officers were wounded.