Santa Cruz firefighters were the first to arrive at 705 Front St., where an odor of natural gas was reported inside the building at about 11:40 a.m., according to the fire department.
Firefighters found natural gas leaking from outside the building, where contractors had been working near the gas service meters, fire officials said.
Fire crews evacuated the surrounding buildings and police shut down Front Street between Cooper Street and Soquel Avenue while PG&E crews worked to control the leak and repair the damaged gas line.
PG&E spokeswoman Monica Tell said the contractors working on the site were the cause of the leak.
"Somehow, while they were doing work, they ruptured the line," Tell said.
According to the fire department, an unknown person leaned against the gas meters, causing the meters to fall over and the gas line to sever.
Tell said PG&E crews stopped the leak at about 1:30 p.m. and that Front Street was reopened at 2:45 p.m.
Firefighters allowed people to reenter the buildings, although PG&E remained on the scene working to completely restore service to affected customers.
As of 4 p.m., a residential building, the Palomar Inn, remained without gas service. Tell said PG&E hopes to restore service to that building by 5:30 p.m.