A man and woman were being quizzed in connection with a major international investigation into the funding of radical Islamic terrorism.
Detectives in Waterford made two arrests as part of the probe into the activities of terror groups.
The couple, aged in their 20s, are an Irishman and a female UK national. They were being questioned last night at Waterford Garda Station after their arrest at 10am yesterday.
Heavily armed members of the Emergency Response Unit and the Regional Support Unit were involved in the raid.
The full extent of the money- gathering scheme has not yet been established, but senior officers said it might have involved up to €100,000.
The man was previously arrested in a garda operation last year which focused on a number of websites that have been attempting to gain funding for IS-related activities in the Middle East.
A senior source told the Herald last night that the arrests were "highly significant" and more garda operations against the terror cell were expected in the coming days.
The arrests happened after a lengthy and highly secretive garda operation directed at websites linked to Islamic terrorist organisations.
The couple were detained at a rented property in Waterford.
"This has to do with the alleged facilitation of the transfer of significant amounts of money and information online," a source said last night.
"The investigation involves a number of websites used to look for funds for the jihadi cause."
Sources revealed that particular attention was being paid to computers, mobile phones and tablets to determine whether electronic traffic may have taken place between the duo and specific individuals overseas.
The couple, who are said to have lived in the Waterford area for some time, are being detained under Section 4 of the Criminal Justice Act.
However, they have been the subject of a specialist garda investigation under Section 6 of the Criminal Justice (Terrorist Offences) Act 2005, which means that someone can be charged with offences that happen outside Ireland.
Gardai must decide whether to release or charge the suspects by this morning.
The arrests followed surveillance of a number of individuals whom gardai were concerned might have had contact with known international terrorist associates. These are understood to include suspected Islamic fundamentalist operatives.
Gardai declined to comment further on the arrests but it is understood that their intelligence operation has been conducted with significant input from overseas security agencies, including the UK, France, Germany and the US.
The arrests form part of an investigation that has been running for more than three years into Irish-based individuals who may have links to international terrorist associates.
In 2004, a US-born woman known as Jihad Jane, who visited Waterford to plot a botched al-Qa'ida terror attack, was sentenced to 10 years in jail.
Colleen LaRose plotted to kill a Swedish artist who had depicted the prophet Mohammed.