Early on Wednesday morning, an Ohio mother reported her 30-year-old daughter missing to police.

Just two hours later, she called them again when she heard cries coming from a shed in her neighbours backyard.

Her daughter was discovered in a hole beneath the shed – about 100cm deep and 60cm wide – that had been covered with wood and “heavy objects”, WLWT 5 reports.

Authorities believe she had been trapped there for four hours.

"She was in a pit that had been dug in the floor of the shed, and wood had been placed over the top of the pit, and heavy objects placed on top the wood to prevent her escape," Blanchester Police Chief Scott Reinbolt said.

The woman - who police believe was having a seizure when she was found - was unable to speak and was taken to hospital for treatment. She has since been released.

Neighbour Dennis Dunn, 45, was arrested in relation to the abduction and is still in police custody. Authorities have revealed the man is known to police and has a history of severe mental health issues.

A woman who lives on the same street as Dunn and his victim has described the ordeal as "horrifying".

"If he would have actually bound her, nobody would even know she was there until too late," Teresa Baker told WLWT 5, adding that she was glad the incident didn't end in tragedy.

Another neighbour, Sherri Pettigrew, told reporters there was no relationship between Dunn and the woman, but that he "keeps in his head" that there was.

Police Chief Scott Reinbolt called the incident a "failure" of the state's mental health care system.

"I am angry at a state government that places dangerous, mentally ill people into our neighbourhoods," he said in a statement.