The arrest was made in the wee hours after a night-long operation by police personnel from Raibaga and Biramitapur, sub-divisional police officer (Biramitrapur), Suman Datta said.
The police team chased three members of the gang who were fleeing after a vain bid to extort money from a businessman at Raibag and engaged them in an exchange of fire, police said adding two of them were nabbed while another managed to escape.
"We have arrested two members of Pahadi Cheetah gang. They are identified as Rohit Surin and Siba Mahanandia of Jharkhand. Two country made pistols and three cartridges were seized from them," said Dutta.
He said though the gang was not very active in Odisha there were some cases against them in Talsara, Kutra and one case under Biramitrapur.