A saltwater crocodile that was stalking remote residents and eating dogs has been shot and removed from a Top End river, ending up as a feast for a nearby Aboriginal community.

The 3.63-metre saltwater crocodile had turned up in the remote Baines River, around 700km south-west of Darwin and near the West Australian border, following flooding in the area.

NT Police said the croc had been repeatedly spotted around 250 metres from homes.

In a statement, police said the "problem crocodile … had been stalking and lunging out of the water at children and adults".

"The crocodile had also reportedly taken multiple community dogs," the statement read.

"In consultation with traditional owners, elders, community members and Parks and Wildlife [rangers], the crocodile was shot to ensure that it did not continue to pose a significant risk to the community."

Following the crocodile's removal, the animal was placed in the back of a police wagon and transported to the nearby remote Aboriginal community of Bulla.

Police said the "community prepared it for a feast in the traditional manner".

Remote sergeant Andrew McBride told ABC News Breakfast the animal was "cooked up into crocodile tail soup, he was on the barbecue, a few of the pieces were wrapped up in banana leaves and cooked underground".

"It was a rather large traditional feast and there were a few full bellies," Sergeant McBride said.

Sergeant McBride said the crocodile had been caught in a Parks and Wildlife trap set 24 hours before its capture.

The remote police officer said crocodiles had been "popping up where they've never been seen before" following widespread flooding in the territory's west earlier this year.

"Just the immense amount of water that came into the area, crocodile are popping up in locations you wouldn't normally see them," he said.

"The amount of water's just pushed them into random places.

"This is obviously one of those crocodiles that's gone for a bit of a swim and a walk and popped up very close to residents."

There's an estimated population of around 100,000 saltwater crocodiles in the Northern Territory's Top End.

Earlier this year, the NT government announced that it was increasing the numbers of crocs allowed to be culled in Top End waterways from 300 to 1,200 every year.