An armed man who was holding a woman hostage outside of Toronto's Union Station during the busy morning rush hour has been shot and killed by police. The incident occurred shortly after another woman, believed to be the man's wife, was shot at a nearby underground shopping mall.

The hostage, held for about 40 minutes by the gunman, was escorted away by police, and appeared uninjured.

Police did not indicate whether the armed man and the hostage knew each other, but witnesses said he appeared to have chosen her at random.

"He just grabbed her... he grabbed the first person he saw," said Oroosh Sheikh, a Toronto-Dominion Bank employee, who was heading to a training session.

"He didn't talk to her (the hostage), he didn't talk to anybody," he said of the shooter.

Police Chief Julian Fantino said an Emergency Task Force member, fearing for the "safety of the woman," shot at the man. Witnesses said there were at least two police snipers.

"The officers did their job," Chief Fantino said. "They eliminated a very serious threat to citizens and themselves. It is a regrettable, unfortunate outcome...but at the end of the day these officers did their job."

At around 8:50 a.m, gunfire was heard and live television pictures showed officers on the move. Some officers were wearing bullet-proof vests and carrying automatic weapons.

The street in front of the station was cordoned off by police tape. Police cars were lined up in front of Union Station, which is fed by Via trains, regional GO Transit service and the Toronto Transit Commission subway. Union is a main transport hub that shuttles commuters to the downtown. When the incident happened, several taxis that looked like they had been left in a hurry were parked near the median of Front Street.

The station serves more than 130,000 GO passengers and 30,000 bus passengers every day. It is also home to the fourth busiest station in the city's transit system, used by 75,000 passengers a day.

Hundreds of passersby, many dressed in business attire as they had been on their way to work, stood in silence around the police tape, looking on.

Chief Fantino told reporters that almost an hour earlier, police were notified that shots had been fired shortly after 8 a.m. in the food court of the TD Centre at 100 Wellington St. West.

A woman was rushed to St. Michael's Hospital with injuries described as minor. Soon after, television was showing pictures of police surrounding a man who was holding a gun to a woman's head.

Chief Fantino said a police officer working in the area confronted a man that matched the description of the suspect in the earlier shooting. The man ran south toward Front Street and then headed west to Union Station where he took the hostage.

Bystander Steven Dunphy said the shooter was a "burly" man, about 6 feet, 3 inches tall, and black, was being chased by police near the station and just arbitrarily grabbed the first person he saw.

The woman, Mr. Dunphy said, was petite. She was described by another witness, Omid Haghighi, 27, as being "pretty calm" throughout the incident and wearing a red top and black pants. He estimated that she was in her late 20s or early 30s.

"The suspect was armed with a firearm that was pointed several times at the police officer as well as the woman that had been taken hostage," Chief Fantino said. "Efforts to negotiate or elicit a response from the suspect did not work out."

The emergency task force and a hostage negotiator arrived on the scene shortly after. After about 40 minutes of refusing to communicate with police the suspect was shot.

Anna Boublikoba, 21, who was headed to a TD Bank training session, said she saw the incident take place through the window of the car she was travelling in.

"Honestly you just go to work and you never expect this kind of thing to happen to you," she told globeandmail.com. "You see movies about that but when it happens in real life it's pretty, pretty shocking."

"Since we saw it pretty close it's a pretty scary thing to see because you never know what he's going to do...There's a lot of emotions and I feel so bad for the girl [hostage]" Ms. Boublinkoba, who saw the man get shot, said.

The special investigations unit is still on the scene getting evidence.

Ontario Premier Dalton McGuinty told reporters Wednesday morning he was relieved the hostage is safe and unharmed.

"Let me take the opportunity as well to thank the police for the job they do every day, day in and day out, on behalf of all of us and our safety."

TTC and GO Transit are still in service. GO buses have resumed running but people are recommended to use alternate entrances to Union station besides the main entrance.

Traffic in the area was at a standstill as police diverted vehicles away from the scene.

Ron Peattie, a pipefitter who was heading to BCE Place to work, told globeandmail.com that he heard police yell, "Hit the dirt! Everybody down!" and ended up lying in front of the Royal York hotel with a number of others for nearly an hour.

"An hour later a police sniper showed up and said "Get all of these people out of here'" Mr. Peattie said. "Ten minutes later, or five minutes later, bang."

Mr. Peattie said a man appeared to have a sawed-off shotgun pressed to the neck of his hostage. He alternated between pointing the gun at police and pointing the gun at the hostage.

Mr. Haghighi said he is now much more afraid in the city he calls home.

"I'm from Jane and Finch [a Toronto area known for its higher crime] I don't expect to see anything like that over here. I [felt]pretty safe here."