"One killed and three (wounded)," said the source, adding that the wounded were receiving treatment at the African Union-UN peacekeeping mission (UNAMID) hospital in Nyala city.
The source said the victims appeared to be Sudanese but it was not immediately clear how the incident happened.
It occurred during a resumption of fighting in the centre of the city -- Sudan's second-largest -- after the killing overnight of a notorious local bandit who was also a paramilitary officer.
The fighting came as the United Nations peacekeeping chief Herve Ladsous visited Darfur, where there has been an upsurge of violence this year.
The shooting appeared to be coming from the downtown area where security forces headquarters are located, the resident said, adding that people had to run for cover near the city market.
Fighting began yesterday night when a carjacker was killed, leading his group to retaliate against government forces, sources familiar with the incident said.
After the initial battle, the security forces reinforced their compounds in the city, the sources said.
"There were huge explosions heard, and gunfire" during yesterday night's clash, one resident said.
The brother of the alleged carjacker identified him as Mohammed Abdullah Shurara, a member of the Central Reserve paramilitary police.
Officers from the national security service asked Shurara to report to their office on Wednesday night, "and in front of his office he was shot," said the brother, Ahmed Shurara.
"After that, his men came and attacked the security office," he said.
A UN panel of experts said in February it had collected testimonies about security problems, including "growing crime inside towns such as Nyala".
It said eyewitnesses and victims blamed elements of the Central Reserve and other paramilitaries "for acts of harassment and intimidation" in rural areas or inside camps for the 1.4 million people displaced by Darfur's decade-long conflict.
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