Police have released CCTV showing the moment officers fatally shot the man who opened fire outside the Empire State Building in New York, killing his former co-worker.

Jeffery Johnson, an out-of-work fashion designer, shot dead his former colleague before he was gunned down by police, stunning tourists and commuters outside of one of the city's most popular landmarks.

Police released CCTV showing Johnson walking rapidly down the street trailed by two police officers. The man then stops, turns around and pulls out a gun. The police officers then fire and kill him.

Nine bystanders were wounded, possibly all of them by police bullets, though none of their injuries are believed to be life-threatening.

Officials say Jeffrey Johnson, 58, had been laid off from Hazan Imports a year ago and that while working there, had been locked in a dispute with the victim, Steven Ercolino.

Police said Johnson had claimed the victim failed to sell enough of his creations and held a grudge.