Derbyshire Police carried out a warrant in Vulcan Street, Derby, and arrested a man in his 40s and another in his 50s.
Police said it was not being treated as a terrorism incident and there was no wider risk to the community.
A cordon has been put in place and the evacuation area covers:
Shaftsbury Crescent – in its entirety
Vulcan Street – in its entirety
Reeves Road – in its entirety
Shaftesbury Crescent – in its entirety
Harrington Street – from Holcombe Street to Vulcan Street
Baseball Drive – to Colombo Street
Cambridge Street – at Reeves Road and Shaftesbury Crescent
Police are going door to door and anyone affected is asked to prepare to be away from home for 24 hours.
Anyone already away from their property is asked to contact Derbyshire Police via Facebook Messenger on the force’s website, or by calling 101.
A rest centre has been set up at the Salvation Army centre on Osmaston Road.
