Police said six people had been killed and the attackers were still at large. They told the public to get off the streets as the city - Germany's third biggest - went into lockdown, with transport halted and highways sealed off.
As special forces rushed to the scene, some people remained holed up in the Olympia shopping center.
"Many shots were fired, I can't say how many but it's been a lot," said a shop worker hiding in a store room inside the mall. The woman, who asked not to be identified, said she had seen a shooting victim on the floor who appeared to be dead or dying.
A worker at a different shop, Harun Balta, said: "We are still stuck inside the mall without any information, we're waiting for the police to rescue us."
It was the third major act of violence against civilians in Western Europe in eight days. Previous attacks in France and Germany were claimed by the ISIL (also known as Daesh) group.
Munich police spokeswoman said six people were killed and an undetermined number wounded. No suspects had been arrested yet, she said, Reuters reported.
"We believe there was more than one perpetrator. The first reports came at 6 p.m. (1700 GMT), the shooting apparently began at a McDonald's in the shopping center. There are still people in the shopping center. We are trying to get the people out and take care of them," the spokeswoman said.
Bavarian broadcaster BR said six people were dead and many wounded in the shopping mall. Munich police said on Facebook that witnesses reported three different gunmen armed with rifles.
A video posted online – whose authenticity could not be confirmed – showed a man dressed in black outside a McDonalds by the roadside, drawing a handgun and shooting towards members of the public.
Police said witnesses had seen shooting both inside the mall and on nearby streets.
Munich's main railway station was also evacuated. BR said police had also sealed off many highways north of Munich had been shut down and people were told to leave them.
