Shock, horror and disbelief filled the heart of Toronto's financial district as police ended a hostage taking by shooting the gunman dead.

The dramatic and tragic incident was carried live on local TV. It tied up throngs of morning rail commuters at the downtown Union Station, and brought several city blocks to a virtual standstill.

The trouble began shortly after 8 a.m. in a food court in the nearby TD Centre office complex.

Police were called after a 45-year-old man from the east-end community of Ajax tried to shoot his estranged wife in the head. Police have not released the name of the man, but unofficial reports identified him as Tony Brooks.

"He fired shots in her direction but did not hit her," Toronto police said in a statement.

"She started to run away but she tripped and fell over. He approached her and started assaulting her."

The woman, who was on her way to work, wasn't badly hurt and needed a few stitches to her head. She was being kept in a downtown hospital for observation, police said.

Hundreds watched hostage ordeal

After that, a police officer spotted the man as he walked away. He ended up grabbing a woman passing by and holding her hostage in front of Union Station.

"She didn't really move around, she just did whatever he said," a witness told CTV affiliate CFTO News.

Austin Delaney, a reporter for CFTO News, says the suspect was very calm.

"He put a shotgun to her head and stood by a hot dog vendor and didn't say really anything to the hostage at all," Delaney said.

Reports say all this went on for about 50 minutes. Police yelled "Drop the gun! Drop the gun!" but the man would not comply.

"I was dumbfounded. I didn't believe it," said Susan Cormier, who works in a stockbrokers' office.

"It's what you see on television. It doesn't happen in real life," she told the Canadian Press.

"He just grabbed her," said a newspaper seller called Dave.

"Everybody else left the area and more police came."

Police opened fire

Concerned the situation would escalate and others could be hurt, a police marksman fired.

Witnesses said the sharp crack of the shot was clearly audible, and left witnesses in shock as police moved in to secure the area.

"I just saw the guy falling down and that was it," a man told CFTO news.

"Witnesses told me that he (the hostage-taker) just stepped back for a split second, and the police saw their moment and an officer close by fired the shot," Delaney said.

The hostage, a woman in her early 20s whose name was not released, walked away from the scene, traumatized but otherwise unscathed.

Police held red sheets around the body to prevent onlookers from seeing the man until he was taken away in an ambulance, at which point fire crews moved in to clean up the area

People said it was hard to believe what they'd seen happening.

"Like you see (such things) in a movie and you're all cool," one man said.

"It's not cool. It's not cool at all."

'No choice,' chief says

Toronto Police Chief Julian Fantino commended his officers for setting the woman free and ending the crisis.

"We had a situation that is very, very volatile, extremely dangerous. There was no choice," Fantino said.

Ontario's Special Investigations Unit is looking into what happened. The unit is called in whenever there is serious injury or death involving police.

Toronto's St. Michael's Hospital, where the man's wife was taken after the first attack, released a statement from her family asking for privacy.

"We came close to losing a family member. We are asking that you respect our privacy at this time. Our main concern is for our family member to get the appropriate care."

Ontario Premier Dalton McGuinty expressed relief that the hostage was unharmed.

Ontario' Community Safety Minister Monte Kwinter said emergency procedures around Union Station, the central point for all rail traffic in the region, may need to be reviewed.