Two people have been killed and 11 others wounded in a shooting in the eastern French city of Strasbourg.
The gunman, known to security services, is on the run and is being hunted by police. He had been injured in an exchange of gunfire with a soldier, police said.
The shooting happened close to a Christmas market in one of the central squares, Place Kléber.
France's counter terrorism prosecutor has opened an investigation.
Confirming the death toll had risen to two, the French interior minister, Christophe Castaner, who is on his way to the city, called it a "serious public security incident".
Seven of the injured are said to be in a serious condition.
Police said the suspect was already known to the security services as a possible terrorist threat.
According to France's BFM TV the man had fled his apartment in the Neudorf district of the city on Tuesday morning as it was being searched by police in connection with a robbery.
Grenades were found during the search.
Residents in Neudorf have been urged to stay indoors amid unconfirmed reports he has been tracked down and cornered by police in the area.
The European Parliament, which is nearby, is currently in lockdown. The parliament's president, Antonio Tajani, tweeted to say it would "not be intimidated by terrorist or criminal attacks".
I express all my sorrow for the victims of the Strasbourg attacks. This Parliament will not be intimidated by terrorist or criminal attacks. Let us move on. We will continue to work and react strengthened by freedom and democracy against terrorist violence.— Antonio Tajani (@EP_President) December 11, 2018
Panic in the city centre
The attack unfolded at around 20:00 local time (8am NZT) close to Strasbourg's famed Christmas market.
Eyewitness Pater Fritz told the BBC he heard gunfire and found a person who had been shot, lying on a bridge. He said he tried to resuscitate him but the man died.
Local journalist Bruno Poussard wrote on Twitter that there had been a dozen shots fired on his street in the city centre - one or two to begin with, then in bursts.
Emmanuel Foulon, a press officer for the European Parliament, wrote that there was "panic" in the centre following the sound of gunfire and that police with guns were running through the streets.
A shopkeeper told BFM TV: "There were gun shots and people running everywhere. It lasted about 10 minutes."
British MEP Richard Corbett tweeted that he was in a restaurant in the city and the doors had been locked.
Am in restaurant in centre of #strasbourg where shots fired with unconfirmed reports of 3 dead.— Richard Corbett (@RCorbettMEP) December 11, 2018
Restaurant locked and not letting anyone in or out.