Police sealed off part of Shirecliffe Road and Cooks Wood Road, near to Parkwood Springs where officers appear to be dealing with an incident in a block of flats.
Photos from the scene showed the emergency services, including armed police and sniffer dogs, as they dealt with the incident.
An eyewitness, who wishes to remain anonymous, told the Star: "We saw armed police pointing guns towards the block of flats.
"There are about five cars and a dog unit was there. The police are still there now."
Police surrounded the Sheffield block of flats
But police later confirmed they were 'concerned for the mental health' of a man inside the building. A man in his 60s has now been arrested.
A resident from the block of flats, who was told he cannot access his home until the conclusion of the incident, says officers told him they were concerned for the mental health of a man inside the building.
He said: "It is to keep him safe and others in the community. With the high risks going on they they are taking extra measures."
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A ststement from South Yorkshire Police said: "Police were called at around 1.20pm this afternoon (Saturday 27 May) to reports of a domestic incident in Shirecliffe Road, Sheffield.
"Specialist resources, including negotiators, attended as there was information to suggest concerns for the welfare of a man at that property.
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"The road was closed as a precautionary measure while officers responded.
"A man in his 60s has been arrested on suspicion of affray and has been taken to hospital by officers.
"Nobody was injured during the incident."
Police arrested a man in his 60s following the incident
The incident comes as South Yorkshire police committed to putting extra police, including armed officers, on the streets throughout the bank holiday weekend.
Colleagues from the Civil Nuclear Constabulary (CNC) and the Ministry of Defence (MoD) Police will stay in the county until after the weekend as the policing operation is gradually reduced following the change in threat level.
Assistant Chief Constable David Hartley said: “The threat level may have reduced but it’s vital after Monday’s horrific attack in Manchester that we provide extra resources and patrols to ensure people feel safe during a busy bank holiday weekend.
“The increase in armed and unarmed officers is for your reassurance and is not based on any specific threat to South Yorkshire.”
It comes after counter-terror police continue to hunt for potential accomplices to the Manchester suicide bombing, carried out by ISIS fanatic Salman Abedi.
Twenty-two people were killed in the blast, including seven children, on Monday night as the bomb exploded as fans left an Ariana Grande concert at the Manchester Arena.
The police have been contacted for further information.