Bullets flew over Broadway yesterday, sending a crush of Times Square tourists and office workers “running for their lives” as cops shot and killed a MAC 10-toting thug.

The broad-daylight gunfire between the CD-hawking scam artist and anti-crime cops in an enclosed passenger-drop-off area at the Marriott Marquis sent shots crashing through store windows and people scrambling for cover.

“The police officers were ducking and diving, trying to get out of the way,” said John Grisewood, 60, of London, who stood about 10 to 15 feet from the fusillade.

He said he heard six shots before “my wife yelled at me, ‘We need to get out of the way.’ She grabbed me, and we went into a shop.”

Robert McKuhan, who works at nearby Maxwell Jewelers, said, “People were running for their lives.

“You could see the fear in their eyes. It was pure chaos. People were hiding behind cars.”

The gunman, Raymond Martinez, 25, of The Bronx, had been running a CD-hawking scam on tourists in front of the Minskoff Theatre on Broadway between West 44th and 45th streets.

Shortly after 11 a.m., two plainclothes cops approached him after recognizing him as an aggressive peddler.

When they asked Martinez — who had a bench warrant out for his arrest — for ID and the tax stamp required to sell CDs legally, he bolted down Seventh Avenue.

Martinez led the cops on a chase back up toward Broadway and onto 45th Street, running into the breezeway where Marriott guests are dropped off.

“Stop! Stop! Show me your hands,” Sgt. Christopher Newsom, 41, yelled, according to police.

With the officers just seven feet away, Martinez whipped the 9mm machine pistol out from under his jacket and fired two rounds before the gun jammed.

The magazine tacked onto the assault weapon held another 27 rounds.

“We’re lucky the weapon jammed,” Police Commissioner Ray Kelly said.

One of the slugs slammed into the window of the souvenir shop Broadway Baby, tearing through a “Wicked” book and an autographed Yankee baseball.

“I ran behind the counter with another employee,” said owner Jonathan Erlich, 23, who thought he was being robbed.

“I felt so helpless that I was going to be shot.”

The other round hit the box office of the Marquis Theatre, where “White Christmas” is playing.

Newsom, who was not wearing a bulletproof vest, placed his arm over his chest to protect his heart — a move police officers are taught in the academy — as he fired four times, hitting Martinez in the chest, collar bone and both arms.

But even the 17-year veteran’s bullets didn’t stop the thug, who struggled with the officers as he lay bleeding — but still clutching his weapon.

“I saw two cops holding one guy down. They were wrestling to get the gun out of his hand,” witness Eric Hoelle said.

Said McKuhan, “He was putting up a good little fight. Next thing you know, the guy’s brother jumped on the back of the cops and was yelling at them, ‘That’s my brother! Get off my brother!’ ”

Martinez, who had five prior arrests and was wanted for an assault in The Bronx, was taken to Roosevelt Hospital, where he died.

He was arrested in the Times Square area earlier this year for hawking CDs without a license, a source said.

He pleaded guilty to a misdemeanor charge of disorderly conduct, but a warrant was issued for his arrest in July after he failed to make a court appearance.

Cops said he was one of a group of hustlers who were working a scam in which they would approach tourists, ask them their names, then write the names on the CDs and demand $10.

Investigators found that the aspiring rapper, who performed with the group Square Free and went by the name “Ready,” frequented gun shows and was carrying business cards from several gun shops.

One, from Gary’s Guns & Transfer, near Richmond, Va., had a chilling, handwritten message on the back.

“I just finished watching ‘The Last Dragon.’ I feel sorry for a cop if he think I’m getting into his paddy wagon,” it read.

The shop’s owner, Gary Lewis, did not return a call for comment.

Cops said the gun Martinez used had been stolen from the seat of a car in Richmond on Oct. 28.

Martinez’s brother Oliver was initially taken into custody, but released with no charges.

As he arrived home last night, another sibling, Anthony, cried out, “They shot my brother!”

“I want justice,” said their mother, Ancela Martinez, outside the Midtown North station house.

“That was my beloved son,” she said. “I want to know why the cop didn’t shoot him in the leg or something.”

Kelly said a preliminary investigation indicates the sergeant followed proper police procedure.

Also at the precinct house was Sharanda Martinez, who said she and Raymond had been married seven years. “All I know is that my son doesn’t have a father,” she said.

Additional reporting by Kevin Fasick, Larry Celona, Murray Weiss, Beth Stebner, Denise Buffa and Matthew Nestel

tom.liddy@nypost.com

