Police believe the shooting of a man wielding an axe was just an argument between two men and the public was not at risk.
Police are continuing to investigate the shooting in Palmerston North yesterday.
The injured man escaped serious injury and has now been discharged from Palmerston North Hospital.
The shooting on College St in Awapuni sparked a large police response. Armed Offenders Squad members and dog unit officers swarmed on the central city about 2pm.
Police cordons closed roads and pupils at West End School and Awatapu College were escorted to safety.
A witness at the College St house when the shooting happened told Fairfax the property's occupants had been concerned about people stalking around the house at night.
He said one of the residents went outside with an axe after noticing people sitting in a car outside.
"When I got out there he [the occupant] had the axe in his hand. He threw the axe, and then a fella pulled a gun and got my mate," he told Fairfax.
The man said the weapon was a shotgun and two shots struck the victim in the torso.
"He's a big fella, he's alright. He said, 'I think he clipped me', and then I saw blood."
Police o said no one had been arrested.
A woman at the scene reported that shots had been fired on the street about 100m-200m away from West End Primary School.
"They are putting those little yellow tickets up and investigating it like a crime scene," she said.
Palmerston North Mayor Iain Lees-Galloway tweeted: "Hope everything is ok over at West End School. Any news? College St swarming with police on Monday afternoon."
Another witness said members of the Head Hunters had been involved. He saw two males flee the scene in a car.
A social media user said he saw a black BMW and red Mazda 626 near the scene.
Police are understood to have found a black BMW at Palmerston North Hospital, near the helicopter pad. A witness believed at least one man had been arrested.
One man was taken to Palmerston North Hospital with a chest injury but has since been discharged.
Anyone with information is asked to call Palmerston North Police on (06) 351 3600 or tanonymously via Crimestoppers on 0800 555 111.