Striking construction workers and security personnel clashed at Rio de Janeiro's Olympic Park, the main venue of the 2016 Summer Games.
Rio Mais, the consortium building Brazil's Olympic venues, confirmed that random gunshots were fired as workers and security confronted each other, but there were no reports of injuries.
Spokespeople for both Rio Mais and the Rio Olympic organising committee said they were investigating the incident.
The work stoppage involving more than 2,000 workers and Rio Mais said it was unclear when work would resume.
The strike is sure to capture the attention of the International Olympic Committee executive board, who are is meeting this week in the Turkish Mediterranean resort of Belek.
A team of IOC inspectors visiting Rio almost three weeks ago, headed by Olympic hurdle champion Nawal El Moutawakel, said the games faced 'challenging deadlines'.
IOC President Thomas Bach has repeated often that Rio 'doesn't have a day to lose', and some fear it could face chronic delays similar to those hitting the upcoming World Cup.
Yet another problem
The strike adds to a growing list of problems confronting Rio organisers with the games just over two years away.
Construction on the second largest cluster of venues in northern Rio de Janeiro, in an area called Deodoro, has yet to begin.
Severe water pollution in Rio's Guanabara Bay, the venue for Olympic sailing, is a growing concern with a test event scheduled there in August.
IOC officials have said they will not risk the athletes' health if the water is unsafe.
Many of the delays are rooted in disputes among Brazil's three levels of government over who pays for what.
Most estimates suggest Brazil will spend about $15 billion on the Olympics, a mix of public and private money.