Two men are dead after a shooting involving police in downtown Montreal on Tuesday morning, including a bystander who was on his way to work.

Police were called to Ste Catherine Street near Ste. Elizabeth around 6:30 a.m. on reports that a man was slashing garbage bags and overturning garbage bins and throwing the trash into the street.

CTV Montreal's Derek Conlon reported early Tuesday afternoon that when police moved in to intercept the man, he pulled out a knife and a foot chase began.

For reasons yet unknown to investigators, police opened fire at the corner of Ste. Denis and Christin Streets, hitting two men.

Shortly after the incident, police confirmed that a 40-year-old homeless man, identified as Mario Hamel, died from his injuries.

A second man, described by police as an innocent bystander who was on his way to work, was taken to hospital in critical condition. The man, who police would only say was 36 years old, died Tuesday evening.

Witness Terry Witwicki said he heard "two shots, bang bang, really quick…and we see this fellow on the sidewalk with a pool of blood all around him."

Because the shooting involved Montreal police, the Surete du Quebec have taken over the investigation.

Sgt. Claude Denis said investigators as well as crime scene technicians will work to piece together the exact chain of events.

"We know that he had a knife in his hand from the very beginning," Denis said of the man police were pursuing.

"What we've learned is that a few minutes before police arrived, (Hamel) was threatening someone that he knew."

Both witnesses and police said they knew of Hamel.

Aubin Boudreau, director general of Accueil Bonneau, a men's shelter, said Hamel had lived at the shelter for the past two years. According to Boudreau, Hamel collected cans to make money.

"It happened not far from here, so eventually we put it together that it was Mario," Boudreau said.

He said Hamel had a family, including children.