Police in the summer capital said on Wednesday that rebels fired at Faruq Zargar - a senior opposition National Conference party leader.
"Zargar was shot at close range at a relative's residence" where he had gone to mourn a family member's death, the spokesman said, describing the opposition leader's condition as "critical".
There has been a series of attacks in recent months on leaders and activists of the National Conference, Kashmir's main opposition party, which ruled the state for most of its history since India's independence from Britain in 1947.
No group has claimed responsibility for the attack on Zargar but separatists opposed to Indian rule have been targeting pro-Delhi politicians as well as other supporters of Kashmir remaining part of India.
Most of the separatist groups want Kashmir to join neighbouring Pakistan.
Just hours before the attack, a soldier and a separatist fighter died in a shootout while two civilian women were killed in the crossfire near southern Tral town, 40km south of Srinagar, a police spokesman said.
In the northern Sopore town, rebels killed a soldier in an ambush. Kashmir's key separatist group Hizbul Mujahidin claimed responsibility for that attack in telephone calls to local media.
Violence has continued in Kashmir alongside a nascent peace process between nuclear neighbours India and Pakistan to end their row over the province.
Indian officials say, however, the number of rebel attacks in Kashmir have fallen since the start of the peace process in January.