Co-workers hugged each other and barricaded doors to hide as a disgruntled employee opened fire "indiscriminately" in a local government building in the US, killing 12 and wounding others before he was shot dead.

Police in Virginia Beach say the death toll has risen to 12, with six wounded. The gunman was also shot dead.

The shooter was employed at the building complex in Virginia Beach and had been dismissed from his job hours before the attack, according to local media citing council sources.

He stormed one of the buildings about 4pm local time armed with a .45 caliber shotgun and fired on workers sitting at their desks, according to witnesses.

The gunman was shot dead in a long gunbattle with police, Virginia Beach Police Chief Jim Cervera said. He has not been identified.

Cervera said the motive for the "violent, violent act" was unknown.

He said the man entered the building and "immediately began to indiscriminately fire on all of the victims".

Cervera described the scene as a "war zone" of carnage as the gunman spent multiple extended magazines. He reportedly went from floor to floor in the three-storey building, shooting at those he saw.

Police entered the building, secured what victims they could, before engaging the suspect in a gunbattle.

"The officers stopped this individual from committing more carnage," Cervera said.

One employee said the office workers were hugging and holding each while one of the employees' desks had barricaded at the door.

"We kept hearing gunshots, it was very muffled but we kept hearing people talking."

Megan Banton, who works in the building, told the Washington Post that some of the people were crying as the attack happened, while some were absolutely silent.

"We kept hearing gunfire," Banton said. "We were trying to keep as quiet as possible."

One police officer is among six wounded in the incident, but is reportedly not in a serious condition. The police chief said he was "basically saved by his bulletproof vest."

The identities of the suspect and the victims are yet to be released.

A heavy police presence remains at the scene after officers searched the building for victims and any potential further armed offenders.

Local media report seeing victims being carried in the backs of cars and utility vehicles towards a nearby hospital. An air ambulance helicopter evacuated one critically injured person.

Police say they are confident there was only the one armed offender.

Virginia Beach Mayor Bobby Dyer said it was "the most devastating day in the history of Virginia Beach".

"The people involved are our friends, co-workers, neighbours and colleagues," he said.

WITNESS ACCOUNTS

City Councilwoman Barbara Henley told local media she had just pulled into the City Hall car park when someone told her she should leave as there was a shooter. She had just got back in her car when she heard a shout: "get down".

People scattered, and Henley drove off. "I was scared to death," Henley said.

Public Works spokesman Drew Lankford, who works in the Operations building where the shooting happened, said he had left the office to get a haircut. While he was gone, his daughter called and said there had been a shooter in his building.

His daughter, who works in the City Hall building alongside, said security told everyone to get under their desks. He rushed back to the office and saw police hiding behind parked cars with their guns drawn.

Local media report seeing victims being carried in the backs of cars and utility vehicles towards a nearby hospital. An air ambulance helicopter evacuated one critically injured person.

District hospitals report receiving six victims so far.

Police say they are confident there was only the one armed offender.

GOVERNMENT FACILITY

Virginia Beach police said the incident was in building 2 at the centre off Nimmo Parkway and Courthouse Drive. The building houses public utilities offices and a permits facility.

The centre is next to both the Virginia Police Department headquarters and the Virginia Beach Sheriff's Office, as well as several other government buildings.

The FBI is responding to assist in securing the scene, as they have jurisdiction over offences committed against government authorities.