The incident dramatized the security challenges faced by the host of the 2016 Olympic Games. The hostages were released unharmed after police cornered the gunmen inside the hotel kitchen.

But a woman was killed and seven people, including four police officers, were wounded by gunfire as the violence spilled from the streets of Rio into the lobby of the Intercontinental Hotel. Nine suspects were arrested, police said.

The incident began when officers on patrol early on August 21 ran into "criminals" in vehicles and motorcycles heading toward Rocinha, the city's most populous 'favela,' or shanty town, police spokesman Colonel Lima Castro told CBN radio. "There was a shootout, and two police officers were slightly wounded," Castro said.

There were some 1,550 people in the hotel at the time, including guests and workers, he told Globonews TV. About 40 percent of the guests were foreigners and none were injured.

Police surrounded the hotel, located in the southern part of the city in front of Sao Conrado beach, and police helicopters hovered above searching for missing gang members.

For the past two years authorities have been cracking down on crime in a "pacification" program in several city favelas, including Rocinha. They say the crackdown has lowered the rates of violence in the city.