A laid-off apparel designer allegedly gunned down a former co-worker outside the Empire State Building on Friday morning, prompting a confrontation with New York police that killed the shooter but left nine others wounded on a crowded rush-hour Manhattan sidewalk, authorities said.

The bystanders were most likely wounded by police in the 9 a.m. incident in the shadow of one of the nation's most recognizable landmarks, authorities said. All but one—a 35-year-old female tourist...