Multiple victims were being treated in a hospital, WRCB news reported.
"We have an officer down," Chattanooga mayor Andy Berke told reporters without specifying if the victim was dead.
"The suspect is also down."
Erica White witnessed the shooting through the window of a hair salon two doors down from the recruiting center.
"We heard one pop, really loud pop. So we went to the door to see what it was," White told CNN. "We saw a guy in a silver Mustang just unloading on the naval recruiting place."
"We're all shook up," she said. "Never expected something like this."
The US Navy tweeted that it was investigating a report of a shooting at a naval recruiting building in Chattanooga.
It said the shooting did not affect the nearby naval reserve base.
The base was placed on lockdown following the shooting, as were a local college and area businesses and government offices.
Local media published images of police officers crouching behind their cars with rifles drawn as they sought to take down the shooter.
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