There was a heavy armed police presence in the area and schools were advised about the situation.
Nelson Boys College, Nelson Intermediate, Hampden St School and Nelson Hospital were in lockdown.
"Schools put themselves on lockdown, we didn't lock the schools down, so we have advised them that the situation has been resolved," Ms Dunn said.
Alex St George said she saw police officers removing and frisking a short, wispy-haired man but it was unclear if he was one of the men involved in the fight.
A number of people spread the news of the emergency on Facebook, with one parent saying their son had been locked inside the school.
"My son just ph'd to tell me he locked in his class," they wrote.
Facebook user Anthony de Thierry warned the community to be safe: "Gunman on the loose, please be safe people."