It happened at about 10:50 a.m. at the Joaquen Grocery and Deli at 598 Morris Avenue in the Melrose section.
The gun blasts were so loud, people standing on the street ducked for cover.
"People said 'it's a big gun, it's a big gun!'" said Luis Rodriguez, a witness.
Police say four suspects came in and tried to tie up store workers. But the owner pulled out a bat and went after one of the suspects, who then drew a gun and shot the owner in the elbow and shoulder, just inches away from his chest.
Luis saw the 64-year-old owner run out of the deli after being shot twice in the arm.
"The guy from the grocery store is running and is bleeding in his arm," Rodriguez said.
The store owner was taken to Lincoln Hospital in stable condition.
Four men were seen running from the store, but so far no arrests have been made.
Surveillance cameras inside and outside the store may have captured pictures of them. Police are going through the footage, searching for clues.
Witnesses reported hearing three shots, and seeing the suspects get into a car.
Patrons of Jouqin's Deli say the owner is a respectable businessman.