Australia's most wanted man Graham Gene Potter has just been spotted

Graham Gene Potter, 59, has been spotted in regional NSW, after seven years on the run. Photo / AAP

Australia's most wanted man is a "master of disguise" but that hasn't prevented him being spotted in NSW after seven years on the run.

Graham Gene Potter, 59, has reportedly been seen at the regional city of Griffith, with police warning the public not to approach the dangerous killer. He is wanted most recently for his alleged links to a murder plot involving Victorian underworld figures.

The convicted murderer has evaded police for years and has an extensive criminal history, Victoria Police acting assistant crime commissioner Paul De Santo said on Thursday.

"It's the disguises, it's his criminal entity network and it's his ability to blend into the community," the acting assistant commissioner said of the crook's ability to avoid apprehension.

"He is a master of disguise so he may have added weight, he may have added a beard, he may have taken off a beard."

Potter is Australia's "number one" fugitive, the senior officer added.

"This man is dangerous ... he has a significant criminal history.

Potter served 15 years in Sydney's Long Bay Jail over the 1981 decapitation murder of Kim Barry, 19, in Wollongong, while on his buck's night.

He's used several aliases over the years, including Josh Lawson, John Page, Jim Henderson and possibly Peter Adams.

Police almost caught him in 2010 when he was cornered in a Queensland caravan park. He'd been using a fatsuit and a ginger beard as a disguise at the time, the Herald Sun reported.

"He has significant organised criminal connections, he has priors for murder he is wanted in connection to (trafficking a) large commercial quantity of drugs." Potter was jailed after he murdered and decapitated a woman on his bucks night in 1981.

He is one of three charged over the alleged planned murders of two men, including an associate of underworld figure Mick Gatto, related to disputes within a drug syndicate.

Potter is also wanted on federal drug charges for a record 4.4-tonne ecstasy haul, which involved 15 million tablets being smuggled in tinned tomatoes in 2008.

Convicted drug trafficker Frank Madafferi was found guilty of trafficking a commercial quantity of drugs in relation to the ecstasy bust. His brother Tony Madafferi, who has been accused in court of being a high- ranking member of Melbourne's mafia, was this week revealed to have dined with Victoria opposition leader Matthew Guy.

Victoria Police was told in 2016 Potter was living in the Griffith area. The latest sighting came through Crime Stoppers and police are urging the caller to again make contact.

Potter has most recently been described as caucasian, 175cm tall, of medium to strong build, with a fair complexion, brown eyes, brown greying hair and a ginger beard.

He is known to wear gold sleeper earrings in both ears, glasses and a gold neck chain.

There is a $100,000 reward offered for information leading to his capture. Police have warned anyone who sees Potter not to approach him but to call triple-0 immediately.

- AAP