Police in Indonesia have revealed more about their hunt for one of the alleged masterminds behind the 2002 Bali bombings.

Authorities say police shadowed 39-year-old Dulmatin for several weeks before descending on a Jakarta property on Tuesday.

A search of the Jakarta property also revealed evidence the group was attempting to organise a terror cell and had carried out multiple robberies to buy weapons and bomb-making materials.

Indonesian President Susilo Bambang Yudhoyono confirmed Dulmatin and two other terror suspects were shot and killed in a police raid near Jakarta.

Dulmatin, who was trained by al-Qaeda in Afghanistan, was wanted for his role in the suicide bombings of two Bali nightclubs in 2002 that killed 202 people, including 88 Australians.

It was Indonesia’s deadliest terrorist attack.

Dr Yudhoyono made the announcement during his speech to an official luncheon in his honour at Parliament House in Canberra on Wednesday.