The incident happened around 3 p.m. on Washington Street near Battery Park, where police say two men got into an argument that ended with shots fired.
The shooting appeared to stem from an ongoing dispute between scalpers selling tickets for cruises to the Statute of Liberty. The stretch of Washington Street where the shots were fired is a known location for the ticket sellers to congregate.
"We believe they are the individuals who were selling tickets down there," NYPD Chief of Detectives Robert Boyce said. "We don't know the exact cause of the dispute, but we believe it is over ticket selling."
Police say the shooting took place about an hour after the initial dispute, with the two men got physical with each other on the street.
Authorities believe the 40-year-old in the red shirt was fighting with the man in blue when he was grazed in the torso, and he was found by police in a car driving across the Brooklyn Bridge shortly after the incident. He was treated at Long Island College Hospital.
"The first male is one of the participants in the initial fight, with the victim who was shot," Boyce said.
A 34-year-old woman believed to be an innocent bystander was shot in the left knee and was taken to New York Downtown Hospital in stable condition.
"A young lady, who was shot in the leg, she is now undergoing treatment," Boyce said. "She's not likely to die, but she is undergoing some surgery this morning."
Police described the two people of interest as:
-- A black man, 30-40 years old, with a heavy build wearing black hat, black jacket, red plaid shirt, blue jeans and black shoes.
-- A black man, bald, 30-40 years old, wearing a blue sweat shirt, blue jeans, multi-colored sneakers and carrying a tan backpack.
Anyone with information on the case is asked to call the NYPD's Crime Stoppers Hotline at 1-800-577-TIPS (8477) or for Spanish, 1-888-57-PISTA (74782).