Prahran's Electric Bar on Chapel Street was rammed by a white Mercedes about 5.40am on Monday, with jerry cans left inside the venue by the offenders.
The bar was left smelling strongly of petrol and it's believed the offenders were interrupted during the attack.
About an hour earlier, officers patrolling the area in response to recent arson attacks spotted two people in hoodies and balaclavas on Greville Street.
Police followed the pair to St Edmonds Road, where they approached a Mazda CX-9 with three others inside.
Inside the stolen car bearing false plates, police found two jerry cans full of fuel.
The four males, three aged 16, one 19 and a 20-year-old woman are being interviewed by police.
Police said the arrests aren't currently believed to be linked to the Electric Bar incident, but they will be assessed as part of the ongoing investigation into the series of hospitality arson attacks.
Sandy, who is part of the Reclaim Chapel Street community group, says crime in the area is out of control.
She often smells smoke from the firebombing attacks on hospitality venues, describing the situation as distressing.
"This has been going on for years and the crime has been escalating," she told ABC News Melbourne.
"This has to stop."
About five kilometres away, a family of five was forced to flee their home after two cars were set alight in their driveway in Caulfield North just before midnight.
The family was able to escape, although the fire had spread to the roof of the double storey home, threatening neighbouring properties.
Police established a crime scene and have deemed the fire suspicious.
Detectives are also investigating a suspicious fire at a kebab shop in Tullamarine, where a car rammed through the front of the shop.
It's believed the fire was then deliberately lit inside before the offenders fled.
A crime scene has been established.
Police have yet to confirm whether the incidents over the past 24 hours are linked, although Operation Eclipse was launched last week to investigate the motives behind the targeting of hospitality venues.
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