Joshua Clavell, 30, remains in a serious but stable condition in Albury Base Hospital, under police guard, after being shot at Richardsons Bend on Wednesday.

His 19-year-old brother, Joel, is in a critical condition after being airlifted to the Alfred Hospital with gunshot wounds.

Police allege the brothers rammed a police car and were armed with a knife and tomahawk before being shot.

An unmarked police vehicle, which appeared to have a bullet hole, was towed from the reserve on Thursday.

Joshua had allegedly become radicalised in recent years and police believe three or four of the Clavell brothers had converted to Islam.

They had been staying in a tipi at the reserve for nearly five weeks, according to a nearby resident, who said they hadn't caused any trouble.

Their father, Rodney, took four people hostage at an Adelaide brothel in 2014, leading to a 12-hour siege which ended when he took his life.

Assistant Commissioner counter terrorism Ross Guenther said Joshua did not like law enforcement.

"I understand the older one has a history of a pretty strong hatred of police, which is long founded, which is pretty much evidenced in the way things played out," he said.

He had been in jail in NSW from August 31 last year until February 4 on charges of intimidation and larceny.

There was a discrepancy between NSW and Victorian authorities as to whether the younger man had also been jailed.

But Assistant Commissioner Guenther said the older man was the focus of counter terrorism investigators.

"We do have ... over 100 people that we monitor at various levels on that (terror watch) list," he said.

"He was definitely one of those on that list."

The pair had reportedly been living in Albury before moving to the campground.

Nearby resident Kevin Richardson said the brothers had been at the camping area for more than a month, and he had spoken to them as recently as Wednesday morning - a few hours before the shooting.

The brothers hadn't caused any issues, he said, and had asked about other locations to move to.

The men had dark hair and beards.

The younger brother didn't want to talk.

"I mean they were pretty quiet," Mr Richardson said.

"They've been pretty good.

"They were very polite."

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He said they had been using a small fire and believed they would have been heading to the nearby service station - which led to the chance encounter with counter terrorism police on Wednesday - for food.

Counter terrorism officers had been travelling to Albury when they found the Clavells at the BP service station, which led to the pair speeding off.

Assistant Commissioner Guenther said they may have moved to be "off grid".

"Perhaps they felt they were under too much spotlight in NSW," he said.

The police had little time to negotiate with Joshua before being forced to shoot him.

Capsicum spray and a taser were used on Joel, which failed to subdue him, and he was shot.

Police are unsure whether the matter is terror related or an attack on police.

A large number of officers spent hours at the crime scene on Thursday.

The assistant commissioner described the actions of members involved in the shooting as "brave".

Police Association of Victoria secretary Wayne Gatt said they would be offered support.

"For our members, it doesn't matter if they're in the Melbourne CBD or Barnawartha North, the threat to their safety and well-being is constant and it's confronting," he said.

"Incidents like this stay with them, whether it be at the forefront of their mind, or in its recesses, it doesn't leave them.

"Our members place themselves between violence and the community.

"They don't expect praise in exchange for that, just a level of respect and understanding.

"The Police Association is offering these members all the support they require and we will continue to do that into the future."

Premier Daniel Andrews said there was no ongoing threat.

"I want to thank the brave Victoria Police officers who put themselves in harm's way every single day, to keep Victorians safe" he said.