Armed police have flooded the area where a gunman has seized hostages at a kosher supermarket in Paris.
Meanwhile, police in northern France have cornered the two Charlie Hebdo massacre suspects.
A police officer told the BBC that two people were confirmed dead after a gunman believed to be the killer of a policewoman in Montrouge entered the supermarket near Porte de Vincennes.
In Dammartin-en-Goele, 35km (22 miles) north-east of Paris, the Charlie Hebdo suspects are also holding a hostage.
The Islamist militants are inside a small printing business and have reportedly said they are prepared to die.
Twelve people were shot dead and 11 were injured in the attack on the office of Charlie Hebdo, a satirical magazine which freely mocks religion.
The unprecedented attack shocked France and there has been an outpouring of sympathy and solidarity worldwide.
Images of heavily armed Swat teams mobilising in Paris were broadcast live.
Reports suggest the hostage-taker in eastern Paris – said to have taken up to five people prisoner – is connected to the Charlie Hebdo attackers.
The Charlie Hebdo attackers, said to be two brothers linked by intelligence officials to militant groups, shouted Islamist slogans during the shooting and then fled Paris in a hijacked car, heading north.
Shots were fired during a high-speed car chase earlier on Friday.
It appears that on Friday the suspects hijacked another car in the town of Montagny-Sainte-Felicite before travelling on to Dammartin.
The car’s owner is said to have recognised them as brothers Cherif and Said Kouachi, the key suspects.
In a televised statement, Interior Minister Bernard Cazeneuve confirmed the men being sought on Friday were those wanted for the Charlie Hebdo attack and said they would be “neutralised”.
It is believed the Charlie Hebdo gunmen were angered by the satirical magazine’s irreverent depictions of the Prophet Muhammad.
During the attack on Charlie Hebdo, the attackers are said to have shouted “We are al-Qaeda, Yemen”, an apparent reference to the al-Qaeda in the Arabian Peninsula group (AQAP).