The gunman at the centre of a six-hour siege at a Sydney industrial unit has died from a self-inflicted gunshot wound hours after shooting a man dead and wounding two others, police say.

Key points: Man allegedly shot dead by gunman about 10:45am

Man allegedly shot dead by gunman about 10:45am Two others shot; one seriously injured

Two others shot; one seriously injured Gunman found dead about 5:00pm with self-inflicted gunshot wound

Gunman found dead about 5:00pm with self-inflicted gunshot wound Three factory workers found inside hiding, escorted out unharmed

Heavily armed police had surrounded Inline Signage on Heald Road at Ingleburn after a gunman opened fire about 10:45am (AEDT), killing a 43-year-old man and also shooting two others.

Police confirmed officers went into the building after 5:00pm and found three factory workers hiding inside.

"Specialist police entered the unit where they located three persons, factory workers, hiding in that unit," Detective Inspector Mark Brett from Macquarie Fields Local Area Command said.

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"Further search of the unit located a male deceased.

"It is believed that that person died from a self-inflicted gunshot wound."

Police could not confirm when the alleged 33-year-old gunman turned the gun on himself, but they said he was armed with a long-armed weapon.

Officers are yet to determine the motive of the alleged shooter.

The tactical operations unit, negotiators and paramedics were on the scene, but the police presence has since reduced.

A crime scene has been set up as detectives from the homicide squad and the south-west metropolitan region continue their investigation.

One man was arrested at the scene earlier for allegedly hindering police.

One of the injured men was shot in the leg, while the other was shot in the shoulder. Both were taken to Liverpool Hospital.

"On arrival police found three males, one deceased and two others with gunshot wounds," Detective Inspector Mark Brett from Macquarie Fields Local Area Command told a media conference.

"Two men with gunshot wounds have been conveyed to Liverpool Hospital."

Police said one of the men had emergency surgery, while the other had superficial wounds to the lower part of his body.

Tactical police at the scene of the shooting ( ABC News: Dan Himbrechts )

A Liverpool Hospital spokeswoman said both men were now in a stable condition.

The immediate area around the signage business was evacuated and members of the public were warned to stay away.

Police said they did not believe the shooting was terrorism related.

Witnesses from nearby businesses said they heard five gunshots ring out, and one person said police "told us not to go near windows".

A man who works in the building complex where the shooting took place said he heard a loud bang, which he later realised was a gunshot.

He said police then evacuated his office and others in the building.

The man said he was sheltering with about 30 other people at a nearby business under police protection.

Rogan Burns, who works at an entertainment agency about 50 metres from where the shootings took place, said the whole area was in lockdown.

"My colleague actually left to go and get the boss a cake for his birthday and the police came screaming in in the vehicles and just told everyone to get back inside their factories," he said.

Police and emergency services personnel are at the scene of a shooting at Ingleburn, in Sydney's west. ( AAP: Dan Himbrechts )

ABC/AAP