The 54-year-old was an employee at the store in Amarillo, Texas

The gunman shot dead by police inside a Walmart in Texas has been identified as an employee at the store who had a work-related dispute with one of the people he took hostage.

Mohammad Moghaddam, 54, took two people hostage, including a manager with whom he had a work-related dispute, at the store in Amarillo, police said.

He was shot dead by SWAT team members on Tuesday afternoon, the Amarillo Police Department said. The two hostages were released and are not injured.

The gunman shot dead by police inside a Walmart in Texas has been identified as an employee at the store who had a work-related dispute with one of the people he took hostage

Officers were dispatched to the Walmart at I-27 and Georgia Street on Canyon Drive on an active shooter call at 11.06am

Police said their initial investigation indicates that there was a dispute between Moghaddam and management over a promotion.

Officers were dispatched to the Walmart at I-27 and Georgia Street on Canyon Drive on an active shooter call at 11.06am, the Amarillo Police Department said.

They determined that the suspect entered the store and fired at least one shot toward the ceiling.

The initial report to police said that he had taken a hostage and gone into an office at the back of the store.

Responding officers from multiple agencies arrived at the store and entered. Police confirmed that the suspect fired no further shots after the first one.

The SWAT continued a search of the store for the gunman, who had barricaded himself into the office.

Police said their initial investigation indicates that there was a dispute between Moghaddam and management over a promotion

An officer on the scene told reporters the situation is being treated as a workplace violence situation

At around 12.20pm, SWAT officers saw a person who they believed to be the only hostage come out of the office. Upon entering the room, they saw the second hostage.

‘The suspect was still armed with a handgun and was a threat to the hostage and the officers,’ a police spokesman said.

The officers fired shots, which hit the suspect. Police say he died immediately.

Both hostages were escorted to safety and examined by paramedics. Neither was injured.

Amarillo police officers, sheriff's deputies from Randall and Potter Counties, as well as Texas highway patrolmen were on the scene, officials said.

SWAT teams and bomb robots were also present. The store is closed as authorities continue their investigation.

APD’s Special Crimes Unit is handling the investigation as it is an officer-involved shooting, the department said.

The Amarillo Police Department tweeted officers were 'on scene with armed subject at the Walmart at Georgia and Canyon Drive' at around 12.30pm

Police said the gunman was shot dead by SWAT team members and the hostages were not harmed

Investigators have not determined how many shots were fired.

The two SWAT officers have been placed on administrative leave, which is standard protocol.

‘There is no indication that this had anything to do with terrorism or the shooting that happened over the weekend in Orlando,’ a statement from the Amarillo Police Department said.

Gunman Omar Mateen was shot dead by a SWAT team after entering a gay nightclub in Orlando in the early hours of Sunday morning and shooting dead 49 people.

Meanwhile, Walmart issued a statement in response to the incident, praising the quick response from law enforcement.

It said: 'As soon as we heard about the situation at our store in Amarillo, Texas, we acted immediately.

'All customers and our two associates who were held hostage are safe. This was a very difficult situation and we are thankful for the quick response from law enforcement.'