Police were called to a Mornington Rd house about 2.45pm after the man's partner told them the man was threatening to shoot her.
The armed offenders squad was mobilised immediately and surrounded the house, Senior Sergeant Trevor Thomson, of Dunedin, said last night.
As officers approached the house from the rear, they found the man outside in the garden.
He was unarmed, compliant and did not resist arrest, Snr Sgt Thomson said.
A rifle was found inside the house, he said.
The woman and her three young children had locked themselves in a bedroom and were not injured.
Traffic was disrupted for about an hour and a-half when parts of Mornington and Elgin Rds were closed during the one-and-a-half hour incident.
Snr Sgt Thomson said a 35-year-old unemployed man was in custody and would appear in the Dunedin District Court today facing charges including unlawful possession of a firearm, threatening to kill and possession of cannabis.