Charleston police received a call about an "active shooter situation" just after 12 p.m. at Virginia's On King, the mayor's office said. One person was shot and taken to the hospital. The extent of the individual's injuries is unknown at this time, Fox News reported.
"The shooter is a disgruntled employee. This is not an act of terrorism or hate crime," Mayor John Tecklenburg said at a news conference.
Tecklenburg said as of 2:30 p.m. the situation is "still unfolding" and the shooter is still in the building. Charleston Police spokesman Charles Francis told reporters the shooter was holding "a couple" of hostages and negotiations between officials and the shooter are being conducted.
"We are trying to get the man to stand down," Tecklenburg said.
The area surrounding the restaurant was blocked and Charleston police asked residents to avoid the area.
Read alsoEight injured in shooting near French mosque – BBCTom and Patsy Plant, who were eating lunch in the restaurant, told The Post and Courier a man came into the kitchen with a loaded gun and said, "There's a new boss in town." The couple escaped the restaurant through the back door.
Another diner said the unidentified armed man, dressed as a kitchen staff member, locked the front door and announced, "I am the new king of Charleston."
About 30 people were dining in the restaurant at the time, witnesses told the newspaper.
Charleston Police sent SWAT teams and a bomb disposal unit to the area and warned people nearby to stay inside buildings or leave.
The incident is a few blocks away from Emanuel AME church, where nine black members of a church were killed by a white man during a June 2015 Bible study. Dylann Roof was sentenced to death in the case.