The cops 'neutralised' suspected terrorist Cherif Chekatt, 29, last night after he was finally found less than two miles from where he carried out Tuesday's mass shooting in Neudorf district.
The Minister of the Interior reported a "specialised field brigade" spotted a man fitting Chekatt's description walking down Rue du Lazaret in the district of Neudorf.
When they challenged him, at 9pm local time tonight, he turned around and opened fire and they fired back "neutralising the assailant."
Security forces, including the elite Raid squad, spent hours Thursday searching in the Neudorf neighbourhood where Chekatt had grown up based on "supposition only" he might have been hiding in a building nearby, a French police official said.
There has been supposition that him being able to hide with his family in custody means there may be a wider network who helped keep him from authorities.
Reuters reporters near the scene heard three to four gunshots after armed police officers and units launched their operation, backed up by a helicopter circling overhead.
A local police official, who spoke to reporters on the condition of anonymity, said he was armed with a pistol and a knife.
The French National Police – who tweeted 'End of the hunt ' – thanked the public for their assistance in tracking down Chekatt, who was wanted "dead or alive."
French President Emmanuel Macron added: "Thanks to all the services mobilised, police, gendarmes and soldiers. Our commitment against terrorism is total."
France's Minister for the Interior Christophe Castaner later tweeted: "Proud of our policemen."
Strasbourg mayor Roland Ries said police had acted on a tip off from a woman, but released no more details than that.
"I think it will help to get back to a life that I would describe as normal," he told reporters after news that Chekatt had been killed.
"With the death of this terrorist … citizens, like me, are relieved," he said.
Parts of Neudorf have been cordoned off by France's elite Raid squad since this afternoon.
Chekatt had been on the run since Tuesday's gun attack which left three dead and 13 seriously injured.
Witnesses said the gunman shouted "God is great!" in Arabic and sprayed gunfire from a security zone near the Christmas market on Tuesday.
Security forces wounded the man but he managed to escape in a taxi, which dropped him off in Neudorf.
ISIS tonight claimed responsibility for the atrocity saying he was one of their "soldiers", but provided no evidence for the claim.
More than 700 officers have been searching for the gunman who had a long criminal record and had been flagged for extremism.
So far, five people, including his parents, two brothers, and a man believed to be a former cell mate, have been arrested and remanded in custody in connection with the investigation.
Police distributed a photo of Chekatt, with the warning: "Individual dangerous, above all do not intervene."
He was the subject of a "fiche S", a watchlist of people who represent a potential threat to national security.
Neighbours on the housing estate where Chekatt family's lived described the suspect as a typical young man who dressed in jogging pants and trainers rather than traditional Islamic robes.
A leader of a community group said outside their apartment building in Strasbourg: "He was a little gangster, but I didn't see any signs of him being radicalised."
France has raised its three-stage threat index to the highest level and deployed 1,800 additional soldiers to patrol streets.
French authorities said Chekatt, born in Strasbourg, appeared on a watch list of people flagged for extremist views.
They said he had 27 criminal convictions, receiving the first at age 13.
When they searched his apartment police found jihadist literature, a grenade, a rifle and four knives.
The people who died in the attack included tourist Anupong Suebsamarn, according to the Thai Foreign Ministry.
Five of the wounded were in serious condition, the prefecture of the Strasbourg region said.
French President Emmanuel Macron was in Brussels on Thursday for a European Union summit.
EU leaders held a minute of silence for the latest victims of the mass shooting.
Hundreds of people gathered in Strasbourg's 500-year-old cathedral on Thursday evening to mourn and seek comfort.
"Evil does not prevail," Archbishop Luc Ravel said.
"And the message of Christmas has not been contradicted but rather confirmed by Tuesday's dramatic night: Evil and good are both there, bFut in the end the good will have last word."
Strasbourg's usually busy streets were eerily empty Thursday morning, with a heavy police and military presence.
Some lit candles and brought flowers to a makeshift memorial at the site of the attack.
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