Police have issued an arrest warrant for Khaled Sharrouf. The jihadist from Punchbowl has become Australia's most wanted terrorist and continues to bait authorities from afar by posting images and threats online. Prime Minister Tony Abbott said the shocking image of Sharrouf's son, believed to be about seven, showed "the kind of hideous atrocities this group [IS] is capable of". Opposition Leader Bill Shorten said all Australians would be ''shocked to their core'' by the picture and he demanded an explanation from the government as to how Sharrouf was able to bypass the passport system. However, when asked about the safety of his nephews, Mostafa said there was "nothing for you to ask about".

Sharrouf posted pictures of himself and his son (pictured) on Twitter. It's believed the photo was one of several taken in late July in the north-eastern Syrian town of Raqqa, where IS fighters executed scores of Syrian soldiers from Brigade 93 and displayed their corpses in the town's main square for days. The caption reads "that's my boy!" and Sharrouf's son struggles to hold up a dried, bloodied head with two hands. Social media antics: Convicted Sydney terrorist Khaled Sharrouf, who is reportedly in Iraq with his wife and children. Fellow Sydney jihadist Mohamed Elomar recently posted photos of himself and Sharrouf holding severed heads in the town square with captions including "few more heads how lovely bludy amazing stuff [sic]".

Fairfax has seen another photo of Sharrouf's son wearing an explosives belt. A friend, who received the photo from Sharrouf, said he would never put his children in the firing line but uses the photos as propaganda to bait the "kuffar" or non-believers. Community leader Jamal Rifi said the photos could only be taken "by a very sick person". "His actions are deplorable," he said. "There's a lot of anger within the community because he's doing much more damage to Islam when he's pretending to be defending Islam." Dr Rifi has known Sharrouf's father for years and spent time with the family at their Chester Hill home.

A court found in 2009 that Sharrouf, who spent four years in prison on terrorism charges, had a troubled upbringing that included violence from his father, illicit drug use and paranoid hallucinations. "This does not give him an excuse but may explain his behaviour," Dr Rifi said. Lebanese Muslim Association president Samir Dandan said the photos were "the act of a lunatic". In 2009, Sharrouf's wife Tara Nettleton told a court that the family planned to move to a farm after his release from prison to "get away from everything ... and stay out of trouble". "He often tells me ... that he can't wait to be able to return home so that he can have a chance to make up to his children all the time that was missed and get to know them again," she said.

Loading Defence Minister David Johnston said on Monday the photographs underlined why the government was moving to introduce tougher counter-terrorism laws. with Latika Bourke and Megan Levy