An underworld figure has been shot dead in a suburban street as a feud over a relatively minor debt erupted into Sydney's latest case of violent gun crime.

The victim, a Bankstown man aged in his late 30s, was shot with a pistol several times at close range as he got out of his car in Riverwood, in the city's south-west, on Saturday night.

Superintendent Stephen Blackmore said the deceased was well known to detectives attached to Operation Spartan, set up to investigate Sydney's recent surge in gun crime.

''The victim has previously been involved in public place shootings,'' he said yesterday.

Superintendent Blackmore said the shooting was over a personal debt.

A police source said the amount of money involved was relatively minor.

''We're talking about relatively small sums of money here, not millions of dollars by any stretch,'' the source said.

Superintendent Blackmore would not elaborate on the nature of the debt, including speculation it may have involved drugs.

But he said it was not a family row and not bikie gang-related.

A man was arrested at the scene of the shooting, at the intersection of Bell and Schofield streets.

The 34-year-old, from Riverwood, was being questioned by detectives yesterday.

The state opposition said Saturday night's shooting was the 21st in April.

Opposition Leader John Robertson said: ''Families are being forced to live in fear of the shooting sprees playing out on Sydney streets.''

The opposition has accused the state government of failing to take action over the shootings. AAP