The conditions of the officers and the suspect are unknown. Police would not say if they are still searching for additional suspects.
Police say shots were fired just after 3:30 p.m. on the 800 block of North Branciforte Avenue. A second round of gunfire was reported on Doyle Street a short time later.
A witness near the scene on North Branciforte Avenue described hearing a large amount of gunfire before being ordered by police to stay inside.
A citywide manhunt is underway. The FBI, Santa Cruz County Sheriff's Department and other nearby agencies are assisting in the search.
Branciforte Middle School and Costa Noa High School are on lockdown due to the police activity.
Stay with ABC7NEWS.COM for updates on this developing story.