It took several officers and the use of pepper spray to restrain a man police say they found forcefully beating 26-year-old Liam Anderson early on Sunday.
An emergency services helicopter arrived at the scene to transport Mr Anderson to hospital, but he died as it was taking off, police said.
The 20-year-old alleged attacker was arrested at the scene in Queenscliff and is assisting police with their inquiries.
Detective Inspector Michael Boutouridis described it as a particularly violent attack.
"It was quite a bloody scene. The man we have in custody was violent and it took a number of police officers to subdue and arrest him," Det Isp Boutouridis told reporters.
"Capsicum spray was used, OC spray, and significant force was used to arrest him."
Det Isp Boutouridis said it was "quite possible" the alleged attacker was under the influence of drugs during the attack.
Police, who said the attack was targeted and the men were known to one another, are expecting to lay charges today.
A note taped to a bin outside the Rose Tattoo lead singer's home asked for privacy.
A witness said she heard moaning for half an hour, but thought it was a local exercise club at a nearby park.
"I just heard a lot of, say for at least half an hour, moaning," the woman told Seven Network.
"Then we found out it was obviously him being kicked or stabbed. We should have looked out but we didn't".
