Memorial services have been held for the two victims of the deadly siege in a Sydney cafe last week.

Hundreds of mourners gathered at the University of Sydney to remember lawyer Katrina Dawson (38).

The mother-of-three's friend and fellow hostage Julie Taylor, who is pregnant, paid tribute.

"If there is one thing above all that we can learn from Katrina's example, it's how to love, to show love, to use love and by loving to make other people and places better," Ms Taylor said.

Ms Dawson's mother and father, her brothers, as well as former Governor-General of Australia, Quentin Bryce, who is a founding member of The Katrina Dawson Foundation, a charity set up to support education opportunities for women, also spoke at the service.

In a lighter moment, her brother Angus said "the world got a bit brighter" on September 9th 1976, when Chinese leader Mao Zedong died and their little sister was born in Perth.

"We liked to joke growing up that one dictator replaced another, for she quickly ruled the house," he said.

A separate service was held for Tori Johnson, the manager of the Lindt Chocolat Cafe in Martin Place, who was also among the hostages taken by Man Haron Monis.

Mr Johnson's partner of 14 years, Thomas Zinn, and father Ken Johnson helped to carry the white coffin into St Stephen's Uniting Church.

Tibetan monks chanted prayers at the end of the service and accompanied the coffin to a waiting hearse.

Sixteen others were taken hostage on December 15th by the shotgun-wielding Iranian, who was a self-styled cleric with a long criminal history.

The standoff ended 16 hours later when police stormed the cafe in a barrage of gunfire to free the captives.

Hopes for a permanent memorial

Volunteers have removed thousands of bouquets of flowers that mourners had left at a separate site near the cafe over the past week, ahead of predicted rainy weather.

The flowers will be turned into mulch that officials hope to use at a permanent memorial, while cards and letters left to honour Mr Johnson and Ms Dawson will be preserved in memory books for their families.

The permanent memorial will be set up after officials consult with the families, New South Wales Premier Mike Baird said.

Meanwhile, Australian Prime Minister Tony Abbott warned of heightened "terrorist chatter" in the aftermath of the siege and said another attack was likely.

"A briefing from the security agencies today indicated that there has been a heightened level of terrorist chatter in the aftermath of the Martin Place siege," Mr Abbott said after a meeting of his National Security Committee.

"That's why it's important that people remain alert and aware as well as reassured that our police and security agencies are doing everything they humanly can to keep us safe."