UPDATE 9.30PM: Inspector Colin Renton, who oversaw the operation, said he had received prank calls in the past and the reasons people made them varied.
"Some just like to see the blue lights, some have a dislike for police and sometimes there are psychological issues at play, or a combination of all three," he said.
He said police had not yet identified the caller, because the call was made through an interpreting service, but they were investigating the matter and charges could be laid.
UPDATE 9PM: The Bendigo Advertiser has learned that the person responsible for tonight's prank call to police could be sent to jail.
The Telecommunications Offences and Other Measures Act states that a person who makes a call to an emergency services number with "the intention of inducing a false belief that an emergency exists" can be imprisoned for up to three years.
UPDATE 8.45PM: POLICE say the hoax call made earlier tonight was "vindictive" in nature.
Sergeant Mark Holloway said the hoax caller purported to be a child whose father was wielding a baseball bat and shotgun and threatening his mother.
The call came in at 5.30pm.
"At some stage during the initial call there was mention of a firearm and a report that a dog had been shot," he said.
"They provided sufficient information for the police to treat the call credibly, which resulted in us doing a cordon and manage in an address in Bendigo.”
"It would appear that it's not quite random: that it's a vindictive prank, which is both costly and a considerable trial to the police."
UPDATE 7.10PM: Police have confirmed a prank call was the catalyst for the operation in Lucan Street.
Police have removed all road blocks in North Bendigo.
EARLIER: Police have locked down a section of North Bendigo.
Acting Sergeant Kevyn Hume-Cook of Bendigo Highway Patrol confirmed Lucan Street was blocked from Bayne Street through to Bakewell Street.
He said parts of Nolan Street were also blocked.
Police can not release any further information on the operation.
More to come.