France's interior minister says a gunman "sowed terror" in three parts of eastern city Strasbourg with a shooting spree that killed three people and left six others with serious injuries.
Earlier, police union officials had said four people were killed. Officials did not explain the reason for the conflicting death tolls.
Interior Minister Christophe Castaner said early on Wednesday that 350 security officers and two helicopters are involved in the search for the assailant after the Tuesday night attack.
The motive was not immediately clear, but with France still on high alert after a wave of attacks commissioned or inspired by ISIS militants since early 2015, the counter-terrorism prosecutor opened an investigation.
Mr Castaner said the gunman was known to security services, named in some quarters as Cherif Chekatt, and the local prefecture said he had previously been identified as a danger to security.
Stephane Morisse from the FGP Police union told the Associated Press that authorities went to the alleged assailant’s residence earlier on Tuesday to arrest him, but the 29-year-old, suspected of ties to radicalism, wasn’t there. Mr Morisse said police found explosive materials at the home.
Mr Morisse said that after the evening shooting, soldiers guarding the Christmas market shot and wounded the suspect before he escaped.
People in the city’s Neudorf area and Etoile Park were told to stay where they were, as officers hunted the shooter on the ground and from the air.
Residents of central Strasbourg describe hearing a series of gunshots and screaming in the street during the attack.
“There were gunshots and people running everywhere,” one local shopkeeper told BFM TV. “It lasted about 10 minutes.”
Resident Yoann Bazard said he heard "two or three shots" and the screams, before he went to a window and saw people running on Tuesday night.
The 27-year-old said: “After that I closed the shutters. Then I heard more shots, closer this time.
“There were two or three episodes like that. As it got close, it was really shocking. There were a lot of screams.”
Freelance journalist Camille Belsoeur said he was at a friend’s apartment on the same street and at first mistook the gunfire for firecrackers.
“We opened the window. I saw a soldier firing shots, about 12 to 15 shots,” he said.
He says other soldiers yelled for people to stay indoors and shouted “Go home, go home” to those outside.
“I heard shooting and then there was pandemonium,” one witness, who gave his name as Fatih, told Agence France Presse. “People were running everywhere.”
He said he had seen three people injured on the ground a few metres from the giant Christmas tree in the centre of the city.
Shortly after the shooting, lines of police vehicles and ambulances streamed into the market area, under festive lights declaring the city the “capital of Christmas”.
“We heard several shots, three perhaps, and we saw people running,” one witness told AFP afterwards, asking not to be named.
“One of them fell down, I don’t know whether it was because she was tripped up or if she was hit,” the witness said.
The European Parliament, which is sitting in Strasbourg this week, was put in to lockdown. Its president says that legislative sessions will continue for the rest of the week.
Antonio Tajani said that the legislature “will not be intimidated by terrorist or criminal attacks. Let us move on.”
Several MEPs were close to the market when the shooting started and holed up in hotels, restaurants or the legislature itself while police were looking for the suspect.
The Christmas market was being held amid tight security this year, with unauthorised vehicles excluded from surrounding streets during opening hours and checkpoints set up on bridges and access points to search pedestrians’ bags.
A source at the prosecutor’s office said the motive for the shooting was not immediately clear.
A Reuters reporter was among 30 to 40 people being held in the basement of a supermarket for their own safety in central Strasbourg, waiting for police to clear the area. Lights were switched off and bottles of water handed out.
French President Emmanuel Macron was informed of the shooting and was being updated as events unfurled, an Elysee Palace official said. Castaner was on his way to Strasbourg, which lies on the border with Germany.
Mr Macron then arrived for a crisis meeting with cabinet officials in Paris shortly after midnight.
"My thoughts are with the victims of the Strasbourg shooting, which I condemn with the utmost firmness," tweeted Jean-Claude Juncker, head of the European Commission. "Strasbourg is an excellent symbol of peace and European democracy. Values that we will always defend."
European security agencies have feared for some time that Islamist militants who left Europe to fight for Islamic State in Syria and Iraq would return after the jihadist group’s defeat, with the skills and motivation to carry out attacks at home.
In 2016, a lorry ploughed into a Bastille Day crowd in Nice, killing more than 80 people, while in November 2015, co-ordinated Islamist militant attacks on the Bataclan concert hall and other sites in Paris claimed about 130 lives. There have also been attacks in Paris on a policeman on the Champs-Elysees avenue, the satirical weekly Charlie Hebdo and a kosher store.
Almost exactly two years ago, a Tunisian Islamist rammed a hijacked lorry into a Christmas market in central Berlin, killing 11 people as well as the driver.