Europe welcomed in the New Year on high security alert, with Munich stations evacuated over an imminent terror threat and fireworks cancelled in Paris and Brussels, while a huge fire ripped through a Dubai hotel.

   German police warned people to stay away from two of Munich's railway stations and avoid large gatherings after "indications that a terror attack" was being planned by Islamists in the southern German city.

   Authorities said early Friday the threat involved a suspected suicide bomb attack by the Islamic State group.

   A police spokeswoman told AFP that they had "reliable information" that the plot targeted festivities under way on New Year's Eve.

   Elsewhere in Europe terror fears loomed large, with firework displays cancelled in Brussels and Paris just weeks after jihadists killed 130 people on the streets of the French capital.

   More than 100,000 police were deployed throughout France to guard celebrations, as defiant Parisians turned out on the Champs Elysees to greet 2016 in the biggest public gatherings since the November 13 attacks.

   In his New Year address, President Francois Hollande said France "has not finished with terrorism yet" and that the threat of another attack "remains at its highest level".

   Belgian police meanwhile were holding five people over an alleged New Year attack plot in Brussels, as well as arresting a 10th suspect over the Paris attacks.

   In Dubai, a huge fire ripped through a luxury 63-storey hotel, the Address Downtown, close to the world's tallest tower where people had gathered to ring in the New Year.

   But authorities put on a spectacular show, refusing to let the hotel blaze, which injured 16 people, disrupt celebrations.

   Festivities went ahead as planned and crowds cheered the arrival of 2016 with bursts of light and colour in a massive fireworks show starting at the landmark Burj Khalifa skyscraper, even as smoke billowed from the nearby blaze.

   Sydney, traditionally the first to host a major New Year's bash, kicked off the global festivities when it lit up the skies with pyrotechnics at the stroke of midnight.

   After Asia, the Middle East, Europe and Africa, the chimes of midnight will finally move across the Americas.

   Jakarta remained on high alert after anti-terror police foiled detailed plans for an alleged New Year suicide attack in the Indonesian capital.

   Turkish police have detained two Islamic State suspects allegedly planning to stage attacks in the centre of the capital Ankara.

   In Moscow, police for the first time closed off Red Square where tens of thousands of revellers traditionally gather.

   "It's no secret that Moscow is one of the choice targets for terrorists," Moscow mayor Sergei Sobyanin said ahead of the celebrations.

   In Britain, Scotland Yard said around 3,000 officers were deployed across central London in what was reported to be an unprecedented anti-terror security effort.

   Fireworks were banned in towns and cities across Italy, in some cases because of a recent spike in air pollution and also because of fears that sudden loud bangs could cause panic.

   In Madrid, only 25,000 people were allowed into the Puerta del Sol square due to security concerns.

   In the United States, authorities said they had arrested and charged a 25-year-old American Muslim convert over an alleged attempt to launch a New Year's Eve attack in upstate New York in the name of the Islamic State group.

   In New York City, despite a pledge of tight security, one million people are expected to turn out to see the Times Square ball descend.

   Cairo meanwhile was trying desperately to attract tourists to bolster the economy.

   The government this year staged celebrations in front of the pyramids near the Egyptian capital, with ambassadors, artists and intellectuals all invited.

   Egypt has been in turmoil since a 2011 uprising but was further hit by the October 31 bombing of a Russian airliner over the Sinai peninsula, which killed 224 people.

   In stark contrast, Sierra Leone's capital Freetown is hoping to reclaim its mantle as host of the best beach parties in Africa after Ebola scared people away.

   The city of 1.2 million was deserted 12 months ago during the worst Ebola outbreak ever recorded.

   "This New Year's Eve I am going to dance and party until the cock crows," said 35-year-old Franklyn Smith.

   In Ivory Coast, 3,100 prisoners held after post-election violence in 2010-11 will also start 2016 on a happy note after President Alassane Ouattara announced in his New Year's address he would reduce their sentences. (AP)