According to Austrian news outlet Kronen Zeitung, A police officer has been shot and is in a serious condition.
There are also reports that hostages are being held at a Japanese restaurant near the synagogue.
The police were able to arrest one person while a second suspect is believed to have been killed by police.
Austrian Interior Minister Karl Nehammer says authorities are still hunting multiple suspects who remain at large in the city.
The public have been told to avoid the area, in Vienna’s central First District, as well as refrain from using public transport.
The official Twitter account for the Viennese Police said: “Shots fired in the Inner City district – there are persons injured – KEEP AWAY from all public places or public Transport – don’t share any Videos or Fotos (sic)!”
Austrian journalist Thomas Mayar, citing the Ministry of the Interior, tweeted: “One dead and several injured in an attack on the synagogue in Seitenstettengasse in the centre of Vienna, says the Ministry of the Interior. Large-scale police operation. Stay in the houses. Shots on Schwedenplatz.”
Hostages are reportedly being held at Akakiko restaurant on Mariahilfer Strauss, near to where the shooting is believed to have taken place.
There are also reports of gunmen at a Hilton hotel in the area.
Mr Nehammer has told ORF TV the incident is believed to be a terror attack and that several perpetrators are thought to be behind it.
ORF reports that one suspect has been killed while another may be on the run, perhaps armed with an explosive device.
Disclose TV reports that at least seven people have been killed, but this has yet to be confirmed by any official sources.
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