Workers and residents have called the news “disturbing” and “frightening”.
Stephen Younger, 57, fromDerbyshire who works close to the disused building, said: “He could be anywhere. This is so disturbing.
“Unfortunately it is the way of the world these days – you are not safe anywhere.”
Georgia Fletcher, 19, who works with Stephen at credit services firm Credit Style, added: “It’s normally quiet here, to have a gunman on the loose is worrying and scary.
“You just don’t know who is carrying a weapon these days, it is frightening.”
Ben Monnie, 38, who lives nearby added: “It’s concerning that there a gun man reported at large, this is a major bus route and a residential area there are lots of young people and families.
“It’s normally very quiet here. I’m quite shocked, I have only lived in Sheffield for 18 months and gun crime here isn’t something I have heard of.”
A 25-year-old woman from the area who only gave her name as Katie, said: “It’s worrying, it’s a bit close for comfort.
“There has been quite a few incidents like this in Sheffield recently.”
She told the Mirror: “It’s unnerving. You don’t expect that from a city like Sheffield.
“There are a lot of old abandoned industrial buildings, it’s that sort of area.”
A spokesman said: “The area being searched for the man within the brewery and disused land is vast, and to ensure the public’s safety while this carried out a number of roads have been cordoned off and will remain closed throughout the morning.”
Dale Hargreave tweeted: “Ooooh, excitement at work. Armed police have surrounded a building 100 yards away. Armed men inside the old stones brewery.”