Whakatane police set up cordons today after reports of a man walking around the coastal settlement of Taiwhakaea brandishing a high powered firearm.
Senior Sergeant Bruce Jenkins said police were called at 9am today, and then alerted the armed offenders squad from Tauranga.
"However, before the armed offenders arrived we managed to arrest the person, a man in his early 40s, a short distance from his house," Mr Jenkins said.
"He is now in custody and will be appearing before the courts either this afternoon or tomorrow."
Under the Search and Surveillance Act 2012, the man's home was searched and police found a high powered gun that had allegedly been stolen in a separate incident.
"We also found other stolen property and an amount of cannabis."
Mr Jenkins thanked the people of the Taiwhakaea community for their co-operation.
"It's good to see people working together to keep their communities safe."