City authorities said officers are investigating reports of an “active shooter” in the world famous Strip which is popular with tourists from all over the world.
According to witnesses, gunmen opened fire on revellers at the music festival.
Officials said “multiple” casualties had been rushed to hospital with gunshot wounds after the attack.
One eyewitness said the hotel was on lockdown, while another claimed there there possibly two gunmen on the 32nd floor of the hotel who had shot at a bodyguard and police.
Gunfire could be heard from the scene as the police operation continued.
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Las Vegas Metropolitan Police Department (LVMPD) warned people to avoid the south end of the Strip.
Officers said Las Vegas Boulevard is shut down at Tropicana, southbound past Russell Road.